In Place Of Fear(1952)

IN PLACE OF FEAR

Aneurin Bevan

In Place of Fear is Ihe political j i bearing on future Eabour Party
testament of one of the most j J policy at home and abroad. As j
significant, and certainly the most ) [ such, it is bound to bd dissected,

I I

interesting, of contemporary j j praised, inveighed against, quoted
political figures. It sols forth in and otherwise assimilated into the ,
simple, coheient, and sometimes 1 ' body politic. No one well in-
moving teims the' mainspring of ' formed in the contemporary 1
Mr. Aneurin Bevan’s political \ political scene can afford to miss
life. Fascinating autobiographical , any of this book. It cannot be
glimpses and administrative ex- I | intelligently discussed from liear-
pcricncc g-'ined in local govern- ^ ’ say, from reviews, or from ten-
ment and ns a Cabinet Minister, ^ dentious newspaper reports. It is, '
lend colour and substance fo a ’in fact, an important book, de- '
political argument which is well j j manding the close attention of all .
sustained, closely reasoned and '| who lake their politics seriously. i
fore, ’fully expounded.

Whatever view may be taken
of Mr. Bevan, it must be assumed
that he has an important, and
perhaps, outstanding political
future. At the moment ho is,
without any question, a dominant
inllucnce in the Labour Party and j
a challenge to its political oppo- j
nenta. j

Thus, apart from the light it
sheds on Mr. Bevan’s personality.

In Place of Fear is an important
political document with a large

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CONTENTS

CHAP. PAGE

I Poverty, Property and Democracy 1

II The R6le of Parliament— Active or Passive? 12

III Modern Man and Modern Society 34

IV Private or Collective Spending 52

V A Free Health Service 73

VJ The Invasion of Doubt 93

VII Social Tensions 106

VIII World Leadership 120

IX Rav/ Materials, Scarcities and Priorities 149

X Democratic Sociausm 167

Appendix 172

CHAPTER ONE

POVERTY, PROPERTY AND
DEMOCRACY

In many ways it would have been better for a book of this sort to
have been written by a person detached from day to day preoccu-
pation with political affairs. Yet, as I come to write, I begin to sec
that there are advantages possessed by a political practitioner like
myself that are denied to anyone living a more cloistered life; for
in the pattern of my own activities has been woven the main
strands of the political epoch which began with the end of the
Great War of 1914-18.

I started my political life with no clearly formed personal
ambition as to what I wanted to be, or where I wanted to go. I
leave that nonsense to the writers of romantic biographies. A
young miner in a South Wales colliery, my concern was with the
one practical question, where does power lie in this particular
State of Great Britain, and how can it be attained by the workers?
No doubt this is the same question as the one to which the savants
of political theory are fond of addressing themselves, but there
is a world of difference in the way it shaped itself for young
workers like myself. It was no abstract question for us. The
circumstances of our lives made it a burning luminous mark of
interrogation. Where was power and which the road to it?

It will be seen at once that thd question formulated itself in
diffei'ent fashion for us than it would have done in a new,
pioneering society or in the mind of someone equipped by a long
formal education. In such cases the question shapes itself in some
such fashion as, “How can I get on?” or, “\^at career shall
I choose?” I don’t mean by this that we were necessarily less
selfish. It was merely that the texture of our lives shaped the
question into a class and not into an individual form. We were

1

2

IN PLACu Or' rcAR

surrounded by the established facts of the Industrial Revolution.
We worked in pits, steel works, foundries, textiles, mills, factories.
These were the obvious instruments of power and wealth. The
question therefore did not form itself for us in some such fashion
as, “How can I buy myself a steel works, or even a part of one?”
Such possibilities were too remote to have any practical import.

Then again, we had a long tradition of class action behind us
stretching back to the Chartists. So for us power meant the use of
collective action designed to transform society and so lift all of
us together. To us the doctrine of laissez-faire conveyed no
inspiration, because the hope of individual emancipation was
crushed by the weight of accomplished power. We were the
products of an industrial civilisation and our psychology corres-
ponded to that fact. Individual ambition was overlaid by the
social imperative. The streams of individual initiative therefore
flowed along collective channels already formed for us by our
environment. Society presented itself to us as an arena of con-
flicting social forces and not as a plexus of individual striving.

These forces are in the main three: private property, poverty
and democracy. They are forces in the strict sense of the term,
for they are active and positive. Among them no rest is possible.

I imply here no narrow definition of poverty, although heaven
blows there is enough of that. I mean the general consciousness
of unnecessary deprivation, which is the normal state of millions
of people in modem industrial society, accompanied by a deep
sense of frustration and dissatisfaction with the existing state
of social affairs. It is no answer to say that things are better
than tlrey were. People live in the present, not in tlie past.
Discontent arises from a knowledge of the possible, as contrasted
with the actual. There is a imiversal and justifiable conviction
that the lot of the ordinary man and woman is much worse than
it need be. That is all I need to have admitted for my present
purposes.

This discontent must be aimed at something, and naturally it
is aimed at wealth and at those who, by possession of wealth,
have a dominating influence on the policy of the nation. And

POVERTY, PROPERTY AND DEMOCRACY 3

third, there is the political democracy which put a new power in
the possession of ordinary men and women.

The conflict between the forces, always implicit, breaks out
into open struggle during periods of exceptional difficulty, like
widespread and prolonged unemployment, and exposes the
Government of the day and the political constitution to great
strain. Sometimes, as in Germany, the constitution breaks under
it. It was not the Treaty of Versailles tliat broke the Weimar
Constitution of Germany. It was unemployment. Hitler talked
in vain when the German was in work. Loss of work is also loss
of status. When Hitler raved about the low status of Germany
among the nations, it was a dramatic representation of the lack of
status of evei-y unemployed worker who listened to hmi. It is not
necessary to believe in the “economic man” to accept this.

The fact is that the Germans had already started to turn away
from him as unemployment began to decline. A little later and
he would have failed. The Weimar Republic had survived the
Versailles Treaty. It could not survive both the Versailles Treaty
and unemployment for six or seven million Germans. The
decisive factor was the unemployment.(^)

The issue therefore in a capitalist democracy resolves itself into
this: either poverty will use democaracy to win the struggle against
property, or property, in fear of poverty, will destroy democracy.
Of course, the issue never appears in such simple terms. Different
flags will be waved in the battle in different countries and at
different times. And it may not be catastrophic unemployment.
There may be a slower attrition as there was in Britain before
the war, but poverty, great wealth and democracy are ultimately
incompatible elements in any society.

This is the answer to so many people who see freedom in a
vacuum. A free people will always refuse to put up with prevent-
able poverty. If freedom is to be saved and enlarged, poverty
must be ended. There is no other solution. The problem of how
to prevent those three forces from coming into head-on collision
is the principal study of the more politically conscious Conserva-
tive leaders. How can wealth persuade poverty to use its political

IN PLACE Oi< FbAR

freedom to keep wealth in power? Here lies the whole art of
Conservative politics in the twentictli century.

In so far as politics is a struggle between competing ideas and
ideals, these accrete around one or other of the three forces. As
a general rule the combatants are aware only of the ideas and
ideals which actuate them, and this fact enables them to generate
passion and to become capable often of ennobling self-sacrifice and
altruism. But all the time these qualities are mobilised in the
service of the dynamic thrust arising from the inlciplay of the
dominating forces working around and through them.

To contend that this is a csmical view of the part played by
individuals in politics, is to deny the possibility of a systematic
study of tlie behaviour of groups of individuals acting together
in society. When we make such generalisations about past
behaviour it is called social science. Why should it be called
cynicism or mechanistic determinism when the same method is
used to explain what is happening around us at the moment? Or
does it mean that the essence of idealism is to be ignorant of why
we do, what we do, when we do it?

I am not asserting that when social reformers are moved to
ease the distress of poor people they are thinking of the minimum
concession necessary to preserve the rule of wealth. What J do
contend is that the suffering of the poor was ignored whilst they
lacked the power and status to insist on alleviation.

One experience remains vividly in my memory. While the
miners were striking in 1926 a great many people were moved to
listen to their case. Certain high ecclesiastical dignitaries even
went so far as to offer to mediate between the mine owners and
the miners. They were convinced that the terms the coal owners
were attempting to impose upon the miners were unreasonable
and would entail much suffering and poverty for hundreds of
thousands of miners’ homes. Their efforts failed. The miners
were beaten and driven back to work under disgraceful conditions.

For years these conditions continued. But were those high
Church dignitaries moved to intervene then? Not at all. For
them the problem was solved. It had never consisted in the

POVERTY, PROPERTY AND DEMOCRACY 5

suffering of the miners, but in the fact that the miners were still
able to struggle and therefore create a problem for the rest of the
community. The problem was not their suffering but their
struggle. Silent pain evokes no response. The social reforms of
the twentieth century are a consequence of the democratic power
of the masses and not of increased enlightenment. Enlightenment
has grown with the emergence of political freedom and it will
diminish if freedom declines.

Political democracy brings the welfare of ordinary men and
women on to the agenda of political discussion and demands its
consideration.

Fascism and all forms of authoritarian goverjunent take it off
the agenda again.

The political high priests of wealth-privilege are acutely con-
scious of the unbridgeable antagonism between private wealth,
poverty and political democracy. They are never statesmen con-
ceiving it to be their duty to advance society beyond the poverty age.
Their job as they see it is to beguile democracy into voting wealth
back into power at each election. For this they adapt their
language and shape their plans. When the people axe behaving as
they wish them to behave, they say complacently: “The British
people are sound at heart.” ■\^en the people look like turning
them down they begin to see the “defects of democracy as a
permanent system of government”, and warn us that “we must
distinguish between freedom and licence”. When we do as they
want us to do, it is freedom. When we suit ourselves, it is licence.

The function of parliamentary democracy, under universal
franchise, historically considered, is to expose wealtli-privilege to
the attack of the people. It is a sword pointed at the heart oi
property-power. The arena where the issues are joined is
Parliament.

The atmosphere of Parliament, its physical arrangements, its
procedure, its semi-ecclesiastical ritual, are therefore worth careful
study. They are all profoundly intimidating for the products of
a board school system who are the bearers of a fiery message
from the great industrial constituencies. The first essential in

6

IN PLACb Oi? i^AR

the pioneers of a new social order is a big bump of irreverence.

“The past lies like an Alp upon the human mind.” The House
of Commons is a whole range of moimtains. If the new Member
gets there too late in life he is already trailing a pretty considerable
past of his own, making him heavy-footed and cautious. When
to this is added the visible penumbra of six centuries of receding
legislators, he feels weighed to the ground. Often he never gets
to his feet again.

His first impression is that he is in church. The vaulted roofs
and stained-glass windows, the rows of statues of great statesmen
of the past, the echoing halls, the soft-footed attendants and the
whispered conversation, contrast dcpressingly with the crowded
meetings and the clang and clash of hot opinions he has just left
beliind in his election campaign. Hero he is, a tribune of the
people, coming to make his voice heard in the seats of power.
Instead, it seems he is expected to worship; and the most con-
servative of all religions— ancestor worship.

The first thing he should bear in mind is that these were not his
ancestors. His forebears had no part in the past, the accumulated
dust of which now muffles his own footfalls. His forefathers were
tending sheep or ploughing the land, or serving the statesmen
whose names ho sees written on tlie walls around him, or whose
portraits look down upon him in the long corridors. It is not the
past of his people that extends in colourful pageantry before his
eyes. They were shut out from all this; were forbidden to take
part in the dramatic scenes depicted in these frescoes. In him his
people are there for the first time, and the history he will make
will not be merely an episode in tire story he is now reading. It
must be wholly different; as different as is the social status which
he now brings with him.(®)

To preserve the keen edge of his critical judgment he will find
that he must adopt an attitude of scepticism ainoimting almost to
cynicism, for Parliamentary procedure neglects nothing which
might soften the acerbities of his class feelings. In one sense the
House of Commons is the most unrepresentative of representa-
tive assemblies. It is an elaborate conspiracy to prevent the real

POV -RiY, PROPcRlY AND DEMOCRACY V

clash of opinion which exists outside from finding an appropriate
echo within its walls. It is a social shock absorber placed between
privilege and the pressure of popular discontent.

The new Member’s first experience of this is when he learns
that passionate feelings must never find expression in forthright
speech. His first speech teaches him that. Having come straight
from contact with his constituents, he is full of their grievances
and his own resentment, and naturally, he does his best to shock
his listeners into some realisation of it.

He delivers himself therefore with great force and, he hopes
and fears, with considerable provocativeness. Wlien his opponent
arises to reply he expects to hear an equally strong and xmeom-
promising answer. His opponent does nothing of the sort. In
strict conformity with Parliamentary tradition, he congratulates
the new Member upon a most successful maiden speech and
expresses the urbane hope that the House will have frequent
opportunities of hearing him in the future. The Members present
endorse this quite insincere sentiment with murmurs of approval.
With that, his opponent pays no more attention to him but goes
on to deliver the speech he had intended to make. After remaining
in his seat a little longer, the new Member crawls out of the House
with feelings of deep relief at having got it over, mingled with a
paralysing sense of frustration. The stone he thought he had
thrown turned out to be a sponge.

I would not have bothered to describe this typical experience
of a working man speaking in the House of Commons for the
first time were it not characteristic of the whole atmosphere. The
classic Parliamentary style of speech is understatement. It is a
style imsuitcd to the representative of working people because it
slurs and mutes the deep antagonisms which exist in society.

It was not until the General Election of 1929 that a British
Parliament was elected on the basis of complete adult suffrage.
The historical function of Liberalism was to achieve the
sovereignty of the people in Parliament, and having done so, to
seek to confine Parliamentary activity to a minimum. The Liberal
revolution found power concentrated in the hands of the great

8

IN FLACt Oi- i-cAR

landlords, rising in hierarchical ascent to the Crown, As the
ownership of property became dispersed, with the rise of urban
development, a corresponding dispersal of political power seemed
the obvious and natural course. Once that had been accomplished,
Liberalism was emptied of its liistorical purpose.

Thomas Jefferson was keenly aware of this.(3) Tj^e franchise
and all that went with it was the political articulation of private
property held in comparatively small quantities. In its idealistic
pronouncements Liberalism asserted the right of the people to bo
consulted in the making of national policy, but in its practical
application it was the assertion of dispersed against concentrated
property power. The history of the development of the franchise
in Britain is conclusive proof of this. Once the Liberal Party had
established itself in Parliament it was in no hurry to extend the
franchise. Indeed, from that point onwards, the unenfranchised
were merely a counter in the electoral battles between the Con-
servatives and the Liberals. This, along with the traditional
tenacity of masculine values, explains why a Liberal Govern-
ment opposed the feminine franchise. Women as such were
apparently not people.

It is necessary to distinguish between the intention of Liberalism
and its achievements. Its intention was to win power for the new
forms of property thrown up by the Industrial Revolution. Its
achievement was to win political power for the people irrespective
of property. In saying this I am not trying to detract from the
genuine idealism of the best spokesmen of the Liberal era. They
reached out for the complete realisation of their ideals with the
utmost sincerity, but with the accomplishment of their inherited
historical task, the thrust of the energy which inspired them
declined. Decades elapsed before their best perorations were
realised.

Political democracy in Britain is only a little more than twenty-
one years old. It is necessary to emphasise this, because so many
people confuse the existence of Parliament with that of a
democracy. Parliament in Britain is centuries old. Democracy
has only imt come of age. In 1929, when I was elected to

POVERTY, PROPERTY AND DEMOCRACY 9

Parliament for the first time, I was a member of the first British
Parliament elected by all men and women over twenty-one years
of age.

So much has been written about the failure of modem
democracy to grapple successfully with the problems of the time
that it is well to keep in mind this immaturity of democracy as a
political institution. Incessant propaganda is aimed at making
the people believe that they have held power for a long time and
that the present state of affairs is the result of their failure to use
it properly, when in fact they have hardly started to use it at all.
In this fashion the people have their self-confidence undermined
and the way is prepared to hand power over to a class of so-called
exceptional people, or to a Leader who is assumed to have the
virtues they are supposed to lack.

This subtle attack on the self-confidence of democracy has gone
very far. It is responsible for many of the shortcomings of the
Socialist experiments in Britain. One of the main functions of
this book is to get the whole question into better perspective. For
the moment, however, I am concerned with the impact of the
arrival of the people’s representatives at Westminster and with
the atmosphere and physical organisation of the Houses of
Parliament.

The function of Parliament as an instrument of social change
has received inadequate attention from students of political
theory. With the completion of universal franchise the Liberal
era ended. At this point Liberal and Conservative theories
combine. Both assign a negative function to Parliament. With
the destruction of the political power of the great landlords and
the limitation of the powers of the Crown, along with the rise of
urban property, the main function of Parliament was to raise
whatever taxes were necessary to maintain the armed forces; and
then to “keep the ring”.

To this conception everything at Westminster is subservient.
It dominates the actual physical arrangements of the Houses of
Parliament, the procedure of the House of Commons, and the
attitude to the Civil Service. That aovemment is best which

10

IN PLACE OF FEAR

governs least is still the traditional and indeed the philosophical
attitude of both the Liberal and the Conservative Parties. Where
they have departed from it they have done so reluctantly, and even
then usually only under the impact of war conditions and necessities.

So much is this the case that a distinguished Civil Servant told
me in 1945, on the occasion of my taking office at the Ministry
of Health, that he could not conceive even a start being made
toward British national recovery with the machinery of Govern-
ment as it was before the war. The Labour Government of 1945
inherited from the war a system of war-time controls and dis-
ciplines which could not have been realised in normal conditions
without something approaching a revolution.

1 have already referred to the effect of the atmosphere of
Parliament on the new Labour Member. The physical facilities
prepared for him are fantastic in their inadequacy. Some people
focus attention on the smallness of the Debating Chamber. They
point out that all the Members cannot find seats. This is really
of little importance. The size of the Chamber is a compromise
between accommodation and the kind of intimate debate in which
the British Parliament excels. Speaking for myself, I prefer the
existing size. A larger Chamber would encourage a style of speech
more declamatory without necessarily being more forthright, and
usually at odds with the kind of business Parliament has to
discuss. The present Chamber can house with felicity the intimate
conversational style suitable to Committee discussion, and at
anothesr time the grand theatre of a great public debate.

It is with the physical arrangements outside the Chamber that
I quarrel, for they are steeped in class bias. They are based on
the assumption that Members of Parliament are well-to-do and
possess houses within easy reach of the House of Commons. This
is no longer the case to the extent of former times.

Now that the State has stepped in as a permanent instrument
of intervention in economic affairs, it is necessary to revise the
relationship between the private member and the Government,
especially as regards the facilities placed at the disposal of the
former. The new House of Commons has gone some way to

POVERTY, PROPERTY AND DEMOCRACY

11

meet the need, but more, much more, is needed if the vast State
apparatus is to be brought and kept under effective democratic
control. If the membership of the House of Commons is to be
composed of men and women of moderate means, which is most
desirable, who normally have their homes in their constituencies,
then clerical and office facilities should be put at their disposal.(*)

It is nonsense to complain of an immense and tendentiously
all-powerful Civil Service, and at the same lime cavil at the small
expenditure required to equip the elected representatives respon-
sible for controlling its actions with the means to do so adequately.

These may seem to some to be matters of detail out of place in
a work of this nature. After more than twenty-two years member-
ship of the House of Commons, I disagree. The effectiveness of
democracy depends to a considerable extent on the facilities
afforded its representatives. If they are crippled in their work
their constituents suffer a corresponding curtailment of authority.

From 1929 onwards in Great Britain the stage was set and all
the actors assembled in the great drama which is the essence of
politics in modern advanced industrial communities. First, there
was wealth, great wealth, concentrated in comparatively few
hands, although cushioned by a considerably developed middle
class. Second, there was a working class forming the vast
majority of the nation and living under conditions which made
it deeply conscious of inequality and preventable poverty. Third,
there was fully developed political liberty, expressing itself
through constitutional forms which had matured for many
centuries and had as their central point an elected assembly
commanding the respect of the community.

There were also political parties roughly corresponding with
tlie class divisions, but with varying degrees of political self-
consciousness. The situation anticipated and feared by Oliver
Cromwell as long ago as 1647 had arrived.(®)

^150 1

CHAPTER TWO

THE ROLE OF PARLIAMENT-
ACTIVE OR PASSIVE?

Society is not a protean mass moulded by dominant ideas, but
rather a living organism absorbing ideas, giving varying degrees
of vitality to some and rejecting others completely. The ideas
which occur to the minds of men, and the objective reality to
which we attempt to relate them, are separate entities only for
the purpose of study. In fact they are two parts of a single whole,
each acting on the other, and what emerges from the interaction
is not easy to predict. What the practitioner in social action should
say to himself is : “I Icnow what I want to do and what I am trying
to do, but what I have actually done I shall not know until I have
done it.”

This, however, does not exempt us from attempting to predict
and to influence the course of events, for the vitality of our own
ideas and the fidelity with which we try to achieve them, are
themselves active forces in the flux of things. The influence of
ideas on social events is profound, and is not less so because
things turn out differently from what we expect. Disillusionment
is a bitter fruit reaped only by the intellectually arrogant.

Between the myopic attitude of the purely “practical man” and
that of the “Intellectual”, who sees society merely in terms of
ideas, lies a fertile terrain ready to be cultivated by all who are
prepared to recognise that political intentions are secular, always
limited, but nevertheless frequently dynamic. Like the tools of
other crafts, they are blunted in use and may have to be renovated
and sometimes discarded for others more apt.

This secular, transitory, limited and provisional nature of
political institutions and ideas is sometimes taken as an excuse
for a tepid faith and an inconstant application, as though only

P

13

THE r6le of parliament— active or passive?

the eternal and the absolute should command our enthusiasm.
The history of human endeavour, and of science, as disciplined
endeavour, would indeed be a woeful history of failure if that
were the case. It is the finished work, and not the tools of his
craft, which excites the love of the artist. It is the sum of human
achievement and the enlargement and growing urbanity of the
lives of individual men and women which should reinforce the
constancy of the political practilioner if he is to be worthy of his
cause.

The student of politics must therefore seek neither universality
nor immortality for liis ideas and for the institutions through
which he hopes to express them. What he must seek is integrity
and vitality. His Holy Grail is the living truth, knowing that
being alive the truth must change. If he does not cherish integrity
then he will see in the change an excuse for opportunism, and so
will exchange the inspiration of tlic pioneer for the reward of the
lackey.

He must also be on his guard against the old words, for the
words persist when the reality which lay behind them has changed.
It is inliercnt in our intellectual activity that we seek to imprison
reality in our description of it. Soon, long before we realise it,
it is we who become the prisoners of the description. From that
point on, our ideas degenerate into a kind of folk-lore which we
pass to each other, fondly thinking we are still talking of the
reality around us.

Thus we talk of free enterprise, of capitalist society, of the
rights of free association, of parliamentary government, as though
all these words stand for the same things they formerly did.
Social institutions are what they do, not necessarily what we say
they do. It is the verb that matters, not the noun.

If this is not understood, we become symbol worshippers. The
categories we once evolved and which were the tools we used in
our intercourse with reality become hopelessly blunted. In these
circumstances the social and political realities we are supposed
to be grappling with change and re-shape themselves indepen-
dently of the collective impact of our ideas. We become the

14

IN PLACE OF FEAR

creature and no longer the partner of social realities. As we
funible with out-worn categories our political vitality is sucked
away and we stumble from one situation to another, without
chart, without compass, and with the steering-wheel lashed to a
course we are no longer following.

This is the real point of danger for a political party and for the
leaders and thinkers who inspire it. For if they are out of touch
with reality, the masses are not. Indeed, they are reality. For
them their daily work is an inescapable imperative. Whilst those
who are supposed to be doing the theori.sing for them are adrift
like passengers in an escaped balloon, the workers are tied to
reality by the nature of their work. In the absence of clear
theoretical guidance they make empirical adaptions and formu-
late practical categories. So far as these arc incomplete, and
therefore unsatisfaotoi7, the first result is a distrust of those who
have demonstrably failed them.

The first function of a political leader is advocacy. It is he who
must make articulate the wants, the frustrations, and the aspira-
tion of the masses. Their hearts must be moved by his words, and
so his words must be attuned to their realities. If he speaks in
the old false categories they listen at first and nod their heads,
for they hear a familiar echo from the past. But, if he persists,
they begin to appreciate that he is no longer with them. He is
not their representative any longer in the true meaning of that
much abused term.

A representative person is one who will act in a given situation
in much the same way as those he represents would act in that
same situation. In short, he must be of their kind. They may
not know the facts as he knows them. Indeed, they cannot expect
to do so. In our complicated society there must be division of
labour, but that division will operate in an atmosphere of con-
fidence only if those working it are of like mind. Thus a political
party which begins to pick its personnel from unrepresentative
types is in for trouble. Confidence declines.

Election is only one part of representation. It becomes full
representation only if the elected person speaks with the authentic

THE r6le of parliament— active or passive? 15

accents of those who elected him. That does not mean ho need
be provincial, nor that he speaks in the local vernacular. It does
mean he should share their values; that is, be in touch with their
realities.

Political parties, like individuals, can have split personalities.
In fact all political parties in time develop schizophrenia. But for
them, shock therapy may well prove fatal.

Politics is an art, not a science. By the study of anthropology,
sociology, psychology and such elements of social and of political
economy as are relevant, we try to work out correct principles to
guide us in our approach to the social problems of the time.
Nevertheless, the application of those principles to a given
situation is an art. The failure to recognise this has caused the
leaders of the Soviet Union to make blunder after blunder, not
only in Russia itself but more especially in their attitude to other
countries.

In particular, the significance of the new relationship between
the Soviet Union and Yugoslavia deserves serious study, for here
is one of the most valuable political mutations in all history.

The Soviet Union is fond of saying that the Revolution cannot
be exported. Yet that is precisely what they are always trying to
do. It is unnecessary to discuss here whether the Soviet leaders
have adopted the only course open to them under the conditions
prevailing in Russia. It is more to the point that they seem
unable to appreciate that the same pattern is not everywhere
applicable, even if it were desirable.

Marshal Tito explained in a speech delivered in the Yugoslav
Parliament in 1948 some of the differences which had developed
between Russia and Yugoslavia. During the war the partisan
forces under Tito had fought for years without direct com-
munication with the outside world, especially with the Soviet
Union. Consequently they had developed their own forms of
organisation as well as their own ideas about the future of their
country. In particular they had definite ideas about the r61e of
the Peasants.

These had fought alongside the urban workers with the greatest

16

IN PLACE OF FEAR

heroism for the deliverance of their country. For them, the war
was essentially a struggle for national independence. The
passionate desire for national freedom, which is the centuries-old
tradition of the peoples of Yugoslavia, merged during the war
with the revolutionary aims of the Yugoslav Communists. There
was therefore a clear understanding between the two. For the
urban workers, Socialism, for the peasants, land, and for both
national independence.

But this was far from the intention of the Soviet leaders. They
had developed the psycliology of what Tito has described as the
“leading nation”, which is a polite term for imperialism. Through
the medium of the Cominform the Soviet Union wished to bind
Yugoslavia to her as she had bound Poland, Rumania, Bulgaria
and Hungary. Yugoslav institutions, ideas and policies were to
follow the Soviet pattern. Under no conditions could the Soviet
Union accept the r61e intended for the Yugoslav peasants. This
is clear from the correspondence which passed between tlie two
countries. To accept the Yugoslav view would not only violate
the basic principles of Stalinism, but it would also seem to reflect
upon the wisdom of the Soviet’s own past policy in this respect.

By insisting on her independmee, Yugoslavia tlircw down the
gauntlet to the Soviet Union. In this it challenged the most sacred
thesis which has held all the Communist parties of the world in
subjection to Russia. Whenever a Communist whispers a word
of criticism of Soviet policy he is silenced by the slogan, “The
Soviet Union is the headquarters of the Revolution.” From this
it follows that what is in her interest is in the interests of the
workers everywhere. The result has been an intellectual depen-
dence on the Soviet so complete as to amount to bondage,

Yugoslavia is the first instance of a Communist country
rebelling against this dogma. China will be the next. For the
Yugoslav Communists the idea was intolerable. After having
fought and won a struggle for national independence in which
countless lives had been lost, they were asked to exchange their
new-won liberty for the tutelage of the Soviet bureaucracy.

The experience of Yugoslavia in her relations with the U.S.S.R.

THE r6le of parliament— active or passive? 17

is the most striking modem illustration of what happens when
political parties apply outworn categories to different national
situations and to novel situations within nations. This may seem
obvious. Unfortimately the obvious is the last thing we respect,
especially if it requires self-examination and self-criticism.

The Marxist school of political thought is the one most accused
of arid political dogma, and indeed, being the most active in the
world, it is probably the most guilty. Marx, and the school which
he founded, put into the hands of the working class movement of
the late nineteenth and the first part of the twentieth centuries
the most complete blueprints for political action the world has
ever seen. Mountains of literature have been written to prove that
Marx was wrong. If that be the case, then never was error more
fertile in practice. No serious student who studies the history of
tlie last half centiuy can deny the ferment of ideas associated with
the names of Marx, Engels and Lenin. Their effectiveness in
arming the minds of working-class leaders all over the world with
intellectual weapons showed that their teaching had an organic
relationship with the political and social realities of their time.

To deny that is to shut one’s eyes to what is happening around
us. The opponents of Marxism are usually so deeply prejudiced
that they are shut off from reality by a wall of their own making.
Their unscholarly bias renders them as unfit guides to pohtical
conduct as the Marxist dogmatists. A sympathetic understandmg
of what Marxists arc trying to say to the world is a prerequisite
to learning where the Marxist practitioners are liable to go wrong.

In so far as 1 can be said to have had a political training at all,
it has been in Marxism. As I was reaching adolescence, toward
the end of the First World War, I became acquainted with the
works of Eugene V. Debs and Daniel de Leon of the U.S.A. At
that time I was reading everything I could lay my hands on.
Tredegar Workmen’s Library was unusually well stocked with
hooks of all kinds. When I found that the pohtical polemics of
de Leon and Debs were shared by so loved an author as Jack
London, the effect on my mind was profound.

Nor was T alone in this. My experience has been shared by

18

IN PLACE OF FEAR

thousands of young men and women of the working class of
Britain, and, as I have learned since, of many other parts of the
world. From Jack London’s Iron Heel to the whole world of
Marxist literature was an easy and fascinating step. The relevance
of what we were reading to our own industrial and political
experience had all the impact of a divine revelation. Everytliing
fell in place. The dark places were lighted up and the difficult ways
made easy.

To those whose lives are a progression from preparatory school
to public school and from tlrere to university, it is not easy to
understand the process of self-education. The self-educating
naturally seize on the knowledge which makes their own experi-
ence intelligible. It is not so much that they look for immediately
useful knowledge. In that they are less utilitarian than the
university student who has to acquire the knowledge that enables
him to pass examinations. That is why, I suppose, the self-
educating cling to what they learn with more tenacity than the
university product. The sclf-cducated man learns only what inter-
ests him and interest is the begetter of intelligence. As a general rule
he learns only what has a significance in his own life. The abstract
ideas which ignite his mind are those to which his own experience
provides a reference.

Thus action and thought go hand-in-hand in reciprocal
revelation. The world of concrete activity renovates, refreshes
and winnows the ideas he gets in books. The world of abstract
thought rises from strong foundations of realised fact, like a great
tree, whose topmost leaves move in obeisance to the lightest
zephyr, yet the great trunk itself issues the final command.

I must not be thought to be extolling the virtues of self-
education against those of trained instruction. Trained instruc-
tion often makes for a wider mobility, both in thought and
action. But what the self-educated learn they hold, and what tliey
hold is an illumination of their own experience. As I have already
said, I was especially fortunate in the quality of the library which
had been built up by the pennies of the miners and given its
distinctive quality by a small band of extraordinary men, them-

THE r6lE of PARLUMENT — ACTIVE OR PASSIVE? 19

selves miners and self-educated. They made available to us both
the orthodox economists and philosophers, and the Marxist
source books, and thus showed a more receptive attitude and less
bigotry than many of our school and college libraries at that time.

Quite early in my studies it seemed to me that classic Marxism
consistently understated the rdle of a political democracy with a
fully developed franchise. This is the case, both subjectively, as
it affects the attitude of the worker to his political responsibilities ;
and objectively, as it affects the possibilities of his attaining
power by using the franchise and parliamentary methods.

This is especially the case in a country with a fully matured
parliamentary democracy like Great Britain. Of course, quotation
after quotation can be produced from the works of Marx, Engels
and Lenin to show their awareness of the facts of parliamentary
democracy.(i) But they never developed this feature of their
philosophy to anything like the extent of the rest.

The proof of this is to be found not in the documents but in
the influence their teaching had on the leaders of my young days.
Parliamentary action was looked upon as an auxiliary of direct
action by the industrial organisations of the workers. Power,
we were taught, was at the point of production, and there we were
already well organised. This attitude was fostered by the industrial
power with which workers like the miners, the transport workers,
and the railwaymen emerged from the 1914-18 War. Going to
Parliament seemed a roundabout and tedious way of realising
what seemed already within our grasp by more direct means. As
a South Wales leader of great intellectual power and immense
influence, Noah Abblet, put it, “Why cross the river to fill the
pail?” These dreams of easy success did not survive the industrial
depression of the twenties. Mass unemployment was a grim
school. Industrial power was just what the unemployed did not
possess.

To render industry idle as a means of achieving political victory
was hardly an effective weapon in such circumstances. Capitalism
had already done it for us. Also, many of the most influential
labour leaders had not arasped the revolutionary implications of

20

IN PLACE OF FEAR

mass industrial action, and those who had were not prepared to
accept them.

I remember vividly Robert Smillie describing to me an inter-
view the leaders of the Triple Alliance had with David Lloyd
George in 1919. The strategy of the leaders was clear. The
miners under Robert Smillie, the transport workers under Robert
Williams, and the National Union of Railwaymen under Thomas,
formed the most formidable combination of industrial workers in
the history of Great Britain. They had agreed on the demands
which were to be made on the employers, knowing well that the
Government would bo bound to be involved at an early stage.
And so it happened. A great deal of industry was still under
Government war-time control and so the State power was
immediately implicated.

Lloyd George sent for the labour leaders, and they went, so
Robert told mo, “truculently determined they would not be talked
over by the seductive and eloquent Welslunan.” At this Bob’s
eyes twinkled in his grave, strong face. “He was quite frank with
us from the outset,” Bob went on. “He said to us: ‘Gentlemen,
you have fashioned, in the Triple Alliance of the unions repre-
sented by you, a most powerful instrument. I feel bound to tell
you that in our opinion wo are at your mercy. The Army is
disaffected and cannot be relied upon. Trouble has occurred
already in a number of camps. We have just emerged from a
great war and the people are eager for tire reward of their
sacrifices, and we are in no position to satisfy them. In these
circumstances, if you carry out your threat and strike, then you
will defeat us.

“ ‘But if you do so,’ went on Mr. Lloyd George, ‘have you
weired the consequences? The strike will be in defiance of the
Government of the country and by its very success will precipitate a
constitutional csrisis of the first importance. For, if a force arises
in the State which is stronger than the State itself, then it must be
ready to take on the functions of the State, or withdraw and
accept the authority of the State. Gentlemen,’ asked the Prime
Minister quietly, ‘have you considered, and if you have, are you

THE r6le of parliament— active or passive? 21

ready?’ From that moment on,” said Robert Smillie, “we were
beaten and we knew we were.”

After this the General Strike of 1926 was really an anti-
climax. The essential argument had been deployed in 1919. But
the leaders in 1926 were in no better theoretical position to face
it. They had never worked out the revolutionaiy implications of
direct action on such a scale. Nor were they anxious to do so.
Industrial action was in the air and tliey could not deny it. The
General Election of 1918 had been a cheat, and the majority in
the House of Commons did not represent the post-election mood
of the country. Nevertheless, the authority of Parliament is part
of the social and political climate of Britain, and it was so even
in the days when the House of Commons was elected on a more
limited franchise than today.

It was not so much the coercive power of the State which
restrained the full use of the workers’ industrial power. That is a
typical error of the undeveloped Marxist school. The incident I
have described illustrates that. The workers and their leaders
paused even when their coercive power was greater than that of
the State. The explanation must be sought in the subjective
attitude of the people to the existence of the franchise and all
that flows from it. The opportunity for power is not enough if
the will to seize it is absent, and that will is attendant upon the
traditional attitude of the people toward the political institutions
which form part of their historical heritage.

Even as a very young man, when I was studying Marxism, I was
deeply conscious of this failure to take account of what, for want
of a better phrase, I call the subjective attitude of peoples. It is
certainly more responsible than anything else for the failure of the
Communists of Great Britain to win a substantial following
among the workers.

The classic principles of Marxism were developed when
political democracy was as yet in its infancy. The State was a
naked instrument of coercion, accompanied by varying degrees of
Royal absolutism. Great inequalities in the distribution of
wealth, with the spectacle of degrading poverty at the bottom

22

IN PLACE OF FEAR

and ostentatious expenditure at the top of the social scale were
rendered possible only by class domination. All improvements
in the condition of the masses resulted from three influences:
genuine sympathy, and the philanthropy flowing from it, as in the
case of the Earl of Shaftesbury; ameliorative measures, partly
actuated by decency and partly by the fear of social unrest; and,
thirdly, the necessity to edueate the masses in the tecliniques of
modern production methods.

In each case it was inevitable that the initiative came from the
top, because the lower stratum of society was politically inarticu-
late. Progress lacked the thrust which comes from the people
when they are furnished with all the institutions of a fully
developed political democracy. The theory of the class struggle
and the conception of the State, as the executive instrument of
the ruling class, was an inevitable outcome of such a situation.
It was the only answer conceivable to the principles of authori-
tarianism implicit in society, and often made explicit in the
arguments of the apologists of the day. In the absence of political
freedom, civil war and revolution remained the only hope of
emancipation for the masses, and still must appear to be the only
hope where similar conditions exist. You can rule either by
counting heads or by breaking them. The ruling cliques of
Britain did not hesitate to break heads when they deemed it
necessary as at Petcrioo, at Newport and in llie case of the
Tolpuddle martyrs.

Of course stability can be maintained when political liberty is
enlarged and economic conditions improved at a pace which is
acceptable to tlie masses. This is the case in many of the British
colonies. The acceleration of the pace which has occurred in
recent years is one of the proudest achievements of the Labour
Government in Britain. Political and economic exploitation is
resented with supercharged bitterness when it occurs at the hands
of a foreign power; for then the emotions of class and nation
merge.

In the main, stability was maintained in Britain during the latter
part of the nineteenth century, despite frequent industrial unrest,

THE r6lE of parliament — ACTIVE OR PASSIVE? 23

because social improvements and an expansion of the franchise
eased the tensions and offered the hope of still further improve-
ment in the lot of the masses. These tensions were further
cushioned by colonial exploitation and purged by emigration.
The festering sores of Europe suppurated into the New World.(**)

Without emigration it is not easy to see how revolution could
have been avoided. Even in Britain the easement afforded by it
was considerable. During the bad years the emigration officer
was busy in South Wales, Scotland, Lancashire and Durham,
indeed, in every place where unemployment tugged at local roots.

I recall one incident vividly. In parts of Monmouthshire whole
townships were idle for years. The poverty was appalling and the
outlook black to the point of despair. The Parliament of business
men elected after the 1914-18 war looked on helplessly, whilst
the craft skills acquired over generations of industrial expansion
rusted and rotted. Idle looms, deserted pits and silent steel-
works mocked at the claims of capitalist economics. What was
the advice offered the workers? If there are deserted pits in
Britain, sink more in Australia. If there is no use for steel in the
old world, make more in the new. If Welsh miners are not
allowed to dig coal for Lancashire weavers, and the weavers must
not make shirts for Welsh miners, then go abroad and repeat the
same monstrous muddle elsewhere. At tlie same time London’s
financial houses were providing credit for the export of modern
textile machines to India. By the alchemy of capitalist finance,
Bombay had been brought nearer to London than Bradford.

In the meantime the unemployed miners marched. In my
district they marched first to the Board of Guardians for poor law
relief. As this was in the beginning provided from the local rates
the situation was ridiculous, for of course unemployed miners
could not pay rates with which to relieve themselves. In these
circumstances the Guardians applied to Whitehall for grants.(®)
These were refused, but loans were offered on condition that the
scales of relief were cut. Mr. Chamberlain insisted on this,
because for him Bedwellty was as far away as later Czecho-
slovakia became.

24

IN PLACE OF FEAR

The conditions demanded by Whitehall were unacceptable to
the unemployed, for they involved semi-starvation. So the un-
employed marched on the workhouse at Tredegar where the
Guardians were meeting. They marched from Tredegar, Ebbw
Vale, Nantyglo and Blaina, and I marched with them — at the head
of them — for I was one of the leaders. And we locked the
Guardians in for two days and nights. Nor wore the Guardians
annoyed with us, for they were in the main our own people. They
were one with us in our attitude to the parsimony of Whitehall.

As the siege of tlic workhouse continued we held innumerable
discussions with each other about the outlook for the future.
One of the leaders was a man from Blaina. He was as fine a man
as I have ever known. Intelligent, well read, and entirely self-
educated, he was one of the best of the finest generation of workers
that Britain has ever produced. We were standing in the work-
house yard watching the guard we had set up outside the main
building. It was a lovely day. The white clouds were drifting
across a high blue sky. The hills lifted towards the rim of the
Black Mountains, faintly etched in the far distance.

“Aneurin,” he said to me, and to this day I can hear the sad
undertones of his voice, “this country is finished. Come with me
to Australia. I’ve sold ray house and I can just manage to pay
my debts and make the passage money. My house cost me six
hundred pounds. They gave me one hundred and fifty for it.
There’s no hope for us here. You and I between us can do better
for ourselves in a new country than here, where all tliat seems
left to us is to rot in idleness.”

His words moved me profoundly, for he was a man for whom
I had an affection amounting to love, and 1 felt my eyes flooding.
For a while I said nothing, for I wished to be clear about my own
position, and I hated saying anything that miglit hurt him. Then
I replied. “David,” I said, “I hate to see you leave us, but if this
is how you feel about it then you must go, and I wish you all the
luck in the world. For myself, I’m going to stay here and fight
it out. You’re an older man than I am, and you’ve lost your
home, and it must seem too difficult to go on living here with the

THE ROLE OF PARLIAMENT— ACTIVE OR PASSIVE? 25

old memories. But if all the young men leave, who is to continue
the liglit, and I can’t bear the thought of seeing them win over
us.” I said this in no spirit of braggadocio, for all my impulses
were to go with him.

When I returned home and told my father of our conversation
he said, “I think you’ve made the right decision, but it will be a
long fi^t.”

He himself did not live long to see the fortunes of the struggle.
He died in my arms in 1925, choked to death by pneumoconiosis.
No compensation was paid him by the mine owners ; in those days
it was not scheduled as an industrial disease under the Workmen’s
Compensation Acts.

I hope the reader will not find this too long a digression from
the argument. It is intended as a personal illustration of the price
good men have paid for evil policies and of how the ruling cliques
of Britain relieved themselves of their victims.

With the collapse of the General Strike in 1926, the workers
of Britain seemed to have exhausted the possibilities of mass
industrial action. As I have pointed out, the trade union leaders
were theoretically unprepared for the implications involved. They
had forged a revolutionary weapon without having a revolutionary
intention. The miners fought on, hoping to rescue tolerable
conditions from the disaster. Month after month they kept up
the struggle against every device the mine owners, helped by a
Conservative Ciovemment, could bring to bear.

But their position was hopeless. The British governing class
was determined to crush their resistance at whatever cost. And
the cost was high. We are still paying it.

During tlie whole episode I was acutely aware of the significance
of what was occurring. Not only had I the knowledge of what
Robert Smillie had said to me, to cast a sombre li^t on the
tragedy, but I was a delegate to all the conferences of the miners,
and I spent much time in the company of A. J. Cook, the miner’s
national secretary. Arthur Cook has come in for more than his
share of blame for the events of 1926. Certainly he had his faults.
His evangelical zeal was greater than his negotiating skill, but he

26

IN PLACE OF FEAR

was passionately devoted to the miners, and he burned himself
out in a flame of protest against the unjust conditions imposed on
his people.

To me the events of that time had an eerie character. It was tike
watching a film unfold that 1 had already seen made. The currents
of history were running strongly against us and in the result we
were sucked under.

The defeat of the miners ended a phase, and from then on the
pendulum swung sharply to political action. It seemed to us that
we must try to regain in Parliament what we had lost on the
industrial battlefield. When, therefore, in 1929, Labour was
returned as the largest single Party in the State, I went to the
House of Commons in a mood of expectancy, but, 1 must confess,
also with misgivings. I had little confidence in MacDonald,
Snowden and Thomas. They had as little appreciation of the
issues involved on the political field as had the trade union leaders
on the industrial.

The Conservative Parly under the leadership of Mr. Stanley
Baldwin was much more aware of the implications of the situation
than was the Labour Party. Mr. Baldwin told a friend of mine at
the lime that ho conceived it to be his chief task to “instruct the
new arrivals in the limitations of parliamentary government”.
The minority Labour Government of 1924 had been a rehearsal,
and from it the Conservatives had learned more than the
Socialists. The Conservatives had learned that short of being in
power themselves the next best thing was a Socialist Government
without a parliamentary majority. In these circumstances the
Socialists accepted responsibUily for conditions they had no real
power to change.

Responsibility without power is the most dangerous of all
situations for a political party with progressive pretensions. The
people are more conscious of the responsibility than they are of
the lack of power. Their attitude is summed up simply in the
crude, but salutary slogan, “get on or get out”.

In his management of delicate parliamentary situations Mr.
Baldwin was more subtle than is Mr. Churchill. In 1929, when

THE r6LE of parliament— active OR PASSIVE? 27

the General Election returned a stronger but still a minority
parliamentary Labour Party, Mr. Baldwin did what he had done
so successfully in 1924. He sat down and waited. “Give them a
chance,” he said, knowing well this was precisely what they
didn’t have ! Mr. Baldwin was a past master in the use of political
inertia. He waited for Mr. MacDonald to weaken his Govern-
ment by policies which offered a series of rhetorical gestures in
place of effective action. Then, when the time came, he struck
with remorseless and deadly precision.

Because of his restraint and apparent laziness, Mr. Churchill
called Mr. Baldwin a “power miser”. But this was a superficial
appreciation of the subtlety of Baldwin’s mind. I rate him very
hi^ indeed in the ranks of Conservative Prime Ministers. It is
true that he presided over a period of capitalist decline in Britain.
But there was no capitalist way of preventing the decline. The
most that can be said against Mr. Baldwin is that being a Con-
servative he could not get out of his economic dilemma by
applying Socialist policies.

In contrast with Baldwin, MacDonald was a pitiful strategist.
Instead of putting forward bold and imaginative proposals to deal
with the economic and financial crisis he waited like Micawber
for “something to turn up”. It was eventually Mr. Baldwin who
turned up by kicking Mr. MacDonald into the Premiership of a
so-called National Government in which MacDonald was the
ignominious prisoner of a Conservative majority.

In 1930, Mr. MacDonald, the alleged enemy of capitalism, was
svaiting anxiously for capitalism to solve its own crisis, and there-
fore rescue him from his embarrassments.

I remember an argument I had with him at the time. I had put
down a resolution for discussion at the parliamentary Labour
Party meeting, calling attention to the impending financial crisis,
and asking for a special National Conference of the Party to be
called. Before the Resolution was discussed MacDonald sent for
me. At this interview he asked me to withdraw the Resolution,
because it was an embarrassment to the Parly. In the course of
our fsonversation he told me that his economic advisers con-

28

IN PLACE OF FEAR

sidered the crisis had reached its peak, and that we could con-
fidently look forward to an improvement in the unemployment
figures, and when this had gone far enough we could go to the
country with every prospect of success. “Recovery is just around
the corner,” he said. It never seemed to occur to him that it was
our business to grapple with the crisis ourselves, and that if
Socialism had no remedy for a crisis in capitalism, then we had no
political territoi7 to stand on. He waved this aside as a purely
theoretical attitude.

Needless to say I did not withdraw the Resolution, and at the
subsequent meeting was overwhelmingly defeated amidst the
general rejoicing of colleagues who, a few months later, received
at the hands of their constituents the lesson they had refused to
learn at Westminster. I wish I could believe the lesson has yet
been learned.

Just as the Industrial Revolution made Great Britain the classic
place for the study of modem capitalism, so the present makes
Britain the classic country in which to study the action and inter-
action of free democratic institutions in their relationship with
the transition from capitalism to socialism. Some might say the
U.S.A. is the place, but this I would contest. The attitude of the
people of the U.S.A. to their Congress is not that of the British
people to the House of Commons. The American does not look
to Congress for initiative in economic affairs like the Briton
looks to Parliament. When a sudden demand for collective action
occurs in the United States, the American business man steps in
and takes charge of the Government apparatus.

In time of war the British business man is mobilised in the
Government machine. But the difference is just there. In Britain
the business man is mobilised. In tlic States he mobilises. Also
the nationalisation of several of the great industries puts at the
disposal of the British Government a large number of adminis-
trators and technicians who are already part of the State apparatus.
Indeed, the assinlilation of this new body of quasi-civil servants
constitutes the most fascinating as well as one of the most pivotal
problems in Britain. The danaers arising from the existence of so

THE r6lE of parliament — ACTIVE OR PASSIVE? 29

important a body of bureaucrats have to be faced and resolved
before we can say that we have found the right answer. But this
is for discussion in another chapter.

It is essential to be clear about the role of Parliament in times
of social upheaval and change if democratic processes are to be
refreshed and strengthened, even as the changes are being carried
out.

There is one situation which is fatal for a democratic parlia-
ment; that is helplessness in face of economic difficulties. At first
this may seem trite. But it is just the lesson the Labour Party in
Britain did not learn in 1924, nor again in 1929, and it is by no
means clear that it has even now learned it.

Parliamentary democracy is essentially government by dis-
cussion. But if discussion is not quickly followed by resolute and
decisive action, then the vitality of democracy declines. If the
deed follows too tardily on the word then the word turns sour.

Parliament docs not “keep the ring”. Parliament is one of the
contestants in the ring- It is not above the battle. It is a weapon,
and the most formidable weapon of all, in the struggle. People
have no use for an institution which pretends to supreme power
and then does not use it. If economic power is left in private
hands, and a distressed people ask Parliament in vain for help, its
authority is undermined. Its r61e is reduced to that of a public
mourner for private economic crimes. All is talked of; nothing
is done. When this condition of afiairs is sustained for a long
period the man of action steps on to the political stage. Hitler
was tlie prototype. Discussion and thought are associated
together. If they prove inconclusive, ^latory, and vacillating,
then the “man who thinks with his blood” appears, and the worst
of all demagogies emerges, the demagogy of leaderology.

This is the real crisis in democracy. People have no use for a
freedom which cheats them of redress. If confidence in political
democracy is to be sustained, political freedom must arm itself
with economic power. Private property in the main sources of
production and distribution endangers political liberty, for it
leaves Parliament with responsibility and property with power.

30

IN PLACE OF FEAR

No one with experience of the House of Commons could deny
that. When in office the Conservatives reduce Parliamentary
intervention in economic processes to a minimum. A striking
instance of this was Neville Chamberlain’s insistence that he had
not promised at election time to deal with unemployment. It was
alien to his way of thinking.

Nor, as we have seen, was he fundamentally different in this
from Labour Leaders of tlie type of Snowden and MacDonald.
They did not look upon parliamentary power as an instrument
for transfoiming the eeonomic structure of society. For them the
role of Parliament was to be ameliorative, not revolutionary. If,
therefore, an economic crisis blew up, they looked to Parlia-
mentary action merely as a means to ease its consequences until
such time as economic forces adjusted themselves and the storm
passed.

There is plenty of evidence that this attitude of mind still
persists. In the White Paper on Unemployment issued by the
war-time Coalition Government tlie same mood appoars.(*) The
economic world was to be carefully watched for signs of an
approaching crisis, like the giuird on a medieval tower looking
anxiously for the approach of an enemy. A small, highly-trained
group of economists were to be charged with this task. Their
function was to keep the world of finance, trade, and commerce
under constant scrutiny. Wlren they saw the attractiveness of
long-tenn investment decline, and the possibilities of a general
fall in prices appear, pubUc investment was to be stimulated and
various other measures taken to increase the purchasing power
of the masses. It is true this showed that something had been
learned from tire experience of the bolween-war years. The
old conception that the nation could not afford increased expendi-
ture at a time of reduced trade had given way to the new con-
ception of stimulating trade and industry by means of budget
deficits.

It is not my intention to analyse the shortcomings of this policy
here. I have written about it elsewhere. I attacked the funda-
mental basis of it in the House of Commons when the late Mr.

THE r6le of parliament— active or passive? 31

Ernest Bevin first presented it to the House of Commons. The
whole conception was based on the assumption that the Coalition
was to continue after the war.

What I wish to emphasise here is that Parliamentary action was
still to be the handmaiden of private economic activity; was still
to be after the fact. Private enterprise was still regarded, in that
policy, as the dominant consideration, and the r61e of Parlia-
mentary action was to provide a stimulant when it looked like
flagging. This is wholly opposed to Socialism, for to the Socialist,
Parliamentary power is to be used progressively until the main
streams of economic activity are brought under public direction.

I do not wish it to be thought that I attach no importance to
the role of tlto Government as an agency for the stimulation of
trade when the private sector of industry looks like developing
its periodic deflationary crisis. But this must always be looked
upon as second best, and not as a substitute for making over
society so as to eliminate the possibilities of these crises.

It is sometimes argued that Britain is exposed to world trade
movements to an extent that limits the application of Socialist
policies to her own economy. This is not the case. If it had been
accepted in 1945, British recovery would have been retarded if
not entirely frustrated. As it was, the private interests and short-
sighted views of many business men made recovery more diflBcuIt
than it need have been. It was so much easier for them to supply
the markets to which they had been accustomed before the war
than to venture into the dollar markets where competition was
more fierce and where adaptability was required to meet the
unusual conditions.(®) Nevertheless, the increase in export to, and
the decline in imports from, the dollar areas showed what could
be done when national planning superimposed itself on private
impulses.

One of the most effective means of mobilising British resources
for British purposes was control over the exchanges. This the
Labour Government inherited from the war. Without it we
should have been economically disarmed as we had been in 1931.
Even so there were loop-holes in it. A considerable contribution

32

IN PLACE OP FEAR

was made to the devaluation crisis of 1949 by illicit capital move-
ments from the sterling area. The convertibility crisis of 1947
also showed how international finance can be used to bring
pressure on unpopular governments. Free trade in money and
planned importing and exporting of goods won’t work together.

Autarchy we cannot achieve, especially in Britain, but that does
not mean that our own economic life must beat to the pulse of
world commerce. We cannot insulate ourselves, but we can
cushion the shocks. Also we have found that our very dependence
on world supplies can be made to work to our advantage. It
makes our market too valuable to other countries for them to
ignore our wishes. So our buying power can and has been used
to fit in our purchases with our over-all needs.

One more reflection to round off the discussion about the
attitude of Socialists to the use of Parliamentary power. The
attainment of a Socialist majority in Parliament is accompanied
by a grave double responsibility; first for the success of their own
claims, and second for the prestige of Parliamentary action.
Other parties do not assert the wisdom of collective action through
Parliament as the core of their creed. At the most they ascribe
to Parliament the function of assembling the conditions in which
private initiative can operate most fruitfully. To that extent they
have not pledged the authority of Parliament in the outcome of
their plans.

With the Socialist it is otherwise. From the outset he asserts
the efficacy of State action and of collective policies. His failure
is the failure of Parliamentary initiative. If that happens, where
can the anxious citizen turn? Back to private enterprise, which
has already failed him? This is a dangerous dilenuna full of
sinister pbssibilities for democratic institutions. The Socialist dare
not invoke the authority of Parliament in meeting economic
difficulties imless he is prepared to exhaust its possibilities. If he
does not, if he acts nervelessly, without vigour, ingenuity and self-
confidence, then it is upon him and his that the consequences will
alight. He will have played his last card and lost, and in the loss,
Parliamentary institutions themselves may be enguUed,

TIIE r6le of parliament— active or passive? 33

Boldness in words must be matched by boldness in deeds or
the result will be universal malaise, a debilitation of the public
will, and a deep lassitude spreading throughout all the organs of
public administration. Audacity is the mood that should prevail
among Socialists as they apply the full armament of democratic
values to the problems of the tunes.

CHAPTER THREE

MODERN MAN AND MODERN
SOCIETY

Before the rise of modem industrialism it could be said that the
main task of man was to build a home for hunsclf in nature.
Since then the outstanding task for the individual man is to build
a home for himself in society. I do not pretend that this definition
has any sociological validity. I do claim tliat it is useful in
enabling us to study widely differing experiences in the history of
mankind.

Before the industrial revolution, man’s relations with physical
nature were immediate and direct. Agriculture was the dominant
occupation, with all that is implied by that— and more is implied
by it than most of us are able to appreciate. The first implication
is that the individual was surrounded by few man-made thing."*.
And most of tliose things were demonstrably created in the
struggle with the forces of nature. The social umt in which he
normally lived was so small and simple that he could comprehend
it witliin a casual stroll. Social relations were seen as personal
relations, for almost all the social institutions which bore upon
his life were represented by people to whom ho could give a
personal name. In these circumstances a phrase like the existence
of “social forces” could not possibly rise spontaneously to his
mind. If the social institutions were inimical to him he never
really saw it as such, but rather as the malignity of the individuals
dominating them. Today this is seen in the case of small scale
production where the personal relations between employer and
worker obscure the property element. It is of no importance for
the argument whether this is good or bad, desirable or undesir-
able. It is enough that it is so.

In this context the individual man was on top of, his society

34

MODERN MAN AND MODERN SOCIETY 35

and physical nature ruled over all. The physical elements were
the main source of his sorrows as of his joys. Religion was the
source of his consolation and of his terrors and one of the chief
offices of the priest was not only to reconcile man with his gods
but also to influence the forces of nature in his favour. Floods,
famines, fires, crop failures, earthquakes, the majestic immensity
of the heavens and the overpowering violence of storms, all drove
home the lesson that by comparison, he was a pigmy grudgingly
permitted a brief life, a fleeting smile and then oblivion.

in tliese circumstances the social organism was an instrument
forged by man to hold in check the forces of nature. It was as
much a tool evolved in the struggle for existence as the hoe with
which he tilled the fields and the weapons with which he hunted
wild animals or other men. The individual and society were not
only inseparable from each other but it would never occur to
him that it could be otherwise. Exile was death, physical and
spiritual. Between him and the terrors of nature stood only his
tribe, his clan, his small society. Inside it he was warm, com-
forted, and to some extent safe. Outside he was nothing.

I have dwelt at some length on what may appear to be such
obvious facts in order to point the differences between that
situation and ours. The difference is so great that it is one of
kind as well as of degree. The individual today in the industrial
nations is essentially an urban product. He is first a creature of
his society and only secondarily of nature.

It is true ho is more detached from society than were his fore-
runners, but he is less detached in the sense that today the forces
that control his life are man-made. Society has won a place for
him in the framework of nature, but in the doing of it the social
environment is the one that has become “natural” to him. He is
now surrounded by man-made things and nature has been pushed
back and at the same time tamed. The physical sciences have
triumphed to such a degree that the ancient sources of terror
have almost ceased to preoccupy his psyche.* Wherever he looks
the achievements of his own hands are apparent; and he is
coiK^cious of the fact that this is only a beginning. Science

36

IN PLACE OF FEAR

promises even more than it has yet achieved, and if what it
promises looks somewhat ominous, it serves to emphasise the
same point — ^it will be man-made and not nature-made. In short,
man in making society has brought nature under control. But
in doing so society itself has got out of tlie control of man.

Now the vicissitudes which afflict the individual have their
source in society. It is this situation which has given currency to
the phrase “social forces”. Personal relations have given way to
impersonal ones. The Great Society has arrived and the task of
our generation is to bring it under control. The study of how it
is to be done is the function of politics.

I started this chapter by saying that tlie problem for man is
now how to make a home for himself in society. To discover what
is meant by this, let us ask ourselves what it is that science has
been trying to do for us in respect of the forces of physical nature.
It has Ijeen trying to make them predictable, to learn how they
behave, and by anticipating their behaviour, to control them to
our uses. Science therefore seeks certainty, not adventure.
Indeed, it might be said that the adventure of science is to realise
the greatest degree of certainty. Science does not scrap the text-
books so that each generation can start the adventure of finding
out anew. It piles up a corpus of reasonably exact knowledge
within which it can move with a sure touch on the periphery of
the uncharted. It does not claim that its search is for the
absolutely predictable. But it does claim that the more predict-
able the better.

If, therefore, individual man is to make a home for himself in
the Great Society, he must also seek to make the behaviour of
social forces reasonably predictable. The assertion of anti-
Socialists that private economic adventure is a desirable con-
dition stamps them as profoundly unscientific. You can make
your homo the base for your adventures, but it is absurd to make
the base itself an adventure. Yet this is the claim made by anti-
Socialists. The digging for coal, the making of steel, the provision
of finance, the generation and distribution of electricity, the
building and siting of factories and houses, tlie whole complete

MODERN MAN AND MODERN SOCIETY 37

Structure of the Great Society is, for the anti-Socialist, a great
arena for private economic adventure. The greater the degi'ee of
unpredictability the greater the adventure, and, in theory at
least, the more precious the prizes. That is why anti-Socialists
shudder at the very name of planning and why planners and
planning are the daily butt of reactionary newspapers.

Nor is this difficult to understand. Their principal proprietors
made their fortunes not by owning newspapers (these they bought
to protect their fortunes and enlarge their personal power,) but
by successful speculation in industry and finance. They laid in
wait for the unwary and then leapt upon them from the financial
undergrowth. They are pouncers, not planners.

For the great mass of the people the case is wholly difierent.
They are the victims who are preyed upon. It is they who are
stalked and waylaid, harried and tormented, their lives made a
nightmare of uncertainty. To the extent that this is no longer
so in Britain and in some other advanced countries, it is because
the economic adventurers have been curbed and controlled in
one sphere of social activity after another. Life has been made
more tolerable by their defeat, not by their ascendancy.

It would be historically inaccurate to under-estimate the part
that private economic adventure has played in bringing modern
industrial techniques into existence. The stimulus of competition,
the appetite for profits, and the urge for wealth and power and
status — all these played their part in the making of modern
society. It may be we could have reached here by other methods
and more seemly incentives. It is now idle to speculate. That
was the road mankind took and we have to deal with what he
has created in taking it. We look back along the roadway to see
the direction taken, not so much to condrann the road makers,
but because it is essential to comprehend the natme of what we
have created if we are to make oiu: way in the new environment.

The methods which were adopted in the making of the Great
Society have little application to its present management. Nor
does history furnish us with any lessons, for we have not passed
this way before. In so far as past civilisations contained an urban

38

IN PLACE OF FEAR

element, it was merely a fringe to the vast hinterland where
agricultural pursuits imposed a primitive pattern on the majority
of mankind. The continuity of civilisation is essentially the by-
product of its urban culture. Where the division of labour
between town and country pennitted a surplus of food, the
products of tire mind appeared and commerce quickened still
further the explorations of the intellect.

All the great teachers of the past arose at this stage. Urban
crafts, and the culture dependent on them, enabled a few elevated
minds to speculate on man’s destiny and on the nature of life and
things. But luminous though tliese speculations were, their
influence was comparatively limited, for the vast majority of
mankind could not lift their heads long enough from the primitive
hoe and plough for their minds to be ignited.

One of the most fascinating sidelights on the story of mankind
is the gulf which persisted between urban illumination and the
twilight behind. All ancient civilisation bears testimony to this
truth. The countryside was eardi-bound, and so little did it share
the intellectual excitement of the urban fringe, that between the
two there has always been hostility. The country was exploited
by the town and could not share in wliat the town could give it;
the magic of intellectual speculation, the tlirill of newly awakened
beauty in the hands of the craftsman obeying the inspiration of
the artist, and the yearning of the explorer for new lands and
strange experience. The labour of the country dweller fertilised
the life of the town, but he was shut out from its excitements.
Country labour was too hard for leisure, and without leisure the
mind remained torpid.

Where the countryside is neglected it always takes its revenge.
Unless country and town march together in reciprocal activity,
civilisation will limp on one foot. This lesson we in Britain are
learning. There are some nations that have not done so. The
failure of the Soviet Union in this respect may yet prove fatal to
the regime.

The British have no right to be complacent about Ihe way the
countryside has been treated, and if, as a consequence, the British

MODERN MAN AND MODERN SOCIETY 39

people have not suffered more than they have, it is because
history has favoured us in this as in so many other ways. We
enjoyed advantages denied to some of the agrarian countries on
which Western civilisation is now making its full impact, vnth
consequences for mankind which still remain to be unfolded.
For more than a century British merchants, and the squirearchy,
had been accumulating innumerable pools of capital, and when
these were flushed by freshets from the maritime discoveries,
sufficient capital was at hand to launch the Industrial Revolution.

Even so the sufferings of the workers, both rural and urban,
have to be studied to be believed. It is not necessary to describe
them here for they have been dealt with by Frederick Engels, the
two Hammands, Arnold Toynbee, and many other writers.0
The merciless exploitation which formed the basis of the unpre-
cedented accumulation of capital equipment in Britain, was made
possibly only by a class dictatorship. The rate of capital accumu-
lation was an expression of the denial of consumption goods to
the masses of the people. It brooks no contradiction that if
political democracy had existed at the time, the rate of capital
accumulation would have been much slower.

I know the reply which will be made to this. I shall be told
my argument proves that a rapid rate of economic progress is
inconsistent with the existence of the universal franchise. This is
true of backward communities where the agricultural population
is able to produce only small surpluses over and above what is
needed for its own reproduction. But what conclusion must we
draw from that? What is the use of taunting the under-developed
countries with the absence of democratic institutions if these can
survive only by a slower rate of economic progress or by help
from outside? When we were at their economic level we were
hanging children and driving them into the mines and into the
mills and organising labour camps in the countryside. Freedom
is the by-product of economic surplus. I speak here not of
national independence, freedom to use one’s own language, and
religious liberty, although even these have often been involved in
the economic struggles. I am speaking of the full panoply of

40

IN PLACE OF FEAR

political democracy which includes these liberties and others
besides. It is wholly unliistorical to talk as though political
liberty has no secular roots. Political liberty is the highest con-
dition to which manldnd has yet aspired, but it is a condition to
which he has climbed from lowlier forms of society. It did not
come because some great minds thought about it. It came because
it was thought about at the time it was realisable.

These are reflections which must be present in our minds as
we witness the awakening of the Orient under the impact of
Western ideas. The Eastern peoples learn by means of the
cinema, the radio, from magazines and books and in innumerable
other ways of the achievements of the industrial West. They
yearn for similar things for themselves, even as they are still
bound on the wheel of primordial techniques. The ferment thus
created is the more active because the East has been, and still is,
in part, a centre of imperial conquest and exploitation. Never has
such explosive material been assembled since the barbarian
hordes swept down on the Mediterranean civilisations.^)

If democratic institutions are to be helped to take root in the
Orient, it can be done not by sending professors to teach the
virtues of democratic constitutions, but by sending the means to
raise their material standards. Man must first live before he can
live abundantly.

It is just here that the United Nations is falling short of its
duty. Collective action against aggressive war is certainly
essential if manldnd is to survive. But it is only one half of the
answer. The social revolutions of the East will overspill national
boundaries and take on the nature of aggressive acts unless their
economic tensions are eased by assistance from the West. For
I repeat, it is impossible for them, in a tolerable period of time,
to produce from their own surpluses sufficient to build the capital
equipment of a modem industrial community. If they are left
to do so they will attempt it under the ruthless repressive instra-
ment of Police States. Russia has gone that way and we have not
yet paid the full price.

The economic function of the Police State i*' to hold down the

MUUtJiiN MAN AND MODERN SOCIErY 41

consumption of the people, especially of the peasant population,
whilst their surplus production is drained off for the purpose of
fixed capital investment. The smaller the surplus the slower the
build-up of fixed capital, and the more repressive the measures
required. Herein lies the whole tragedy of the Soviet Union.
She has been trying to lift herself by her boot straps. In the
furtherance of this policy she has developed an extreme centralist
policy. More local responsibility would reduce the rate of
accumulation because the nearer responsibility is to the people
the more it is amenable to the people’s sufferings. From this
centralist policy to the creation of a vast bureaucracy to serve
the needs of the central direction, is a short and logical step.
Everything is sacrificed to the requirements of the “Plan”.

I remember a short visit I paid to Russia in 1930; that was
during the second year of the first five-year plan. On my return
I was asked by a trade union leader of international repute what
my impressions were. I said my visit had been too short to admit
of any final conclusions, but one impression I had gained: whereas
in Britain we were slaves to the past, in Russia they were slaves
to the future. The impression formed then has been amply
confirmed by subsequent developments.

Nor can Western capitalism shed itself of a measure of responsi-
bility for this. Russia was surrounded by a wall of hostility,
trade was hampered and sometimes cut off entirely. It should not
be forgotten that the Conservatives won the 1924 General
Election by attacking the proposal of the then Labour Govern-
ment to advance a loan to Russia — a loan which would have
been spent in Britain and would have provided work for the
unemployed of Britain as well as capital equipment for Russia.
The Iron Wall which Russia afterwards built around herself was
in large measure the product of the rebuffs of those years.

At the moment it looks as thou^ America is going to repeat
the same folly in China. The way to treat a revolution in an
agrarian country is to send it agricultural machinery, so as to
increase food production to the point where the agricultural
surplus will permit of an easier accumulation of the industrial

42

IN PLACE OF I’EAR

furniture of modern civilisation. You cannot starve a national
revolution into submission. You can starve it into a repressive
dictatorship ; you can starve it to the point where the hellish logic
of the Police State takes charge.

It is pertinent hero to point to the different conditions under
which contemporary revolutions of the East have to be carried
out as distinct from those of the Americas in the late eighteenth
and early nineteenth centuries. In the latter case Investment
flowed freely from Europe to America, and along with the invest-
ment went skilled artisans of all kinds. It is true America did not
have a large peasant population, but this was a further advantage.
•It was an empty country and it was filled by waves of migrants
from Europe; many coming from backward European countries,
but the advanced nations also made their contribution.

Much of the machinery reaching America took the form of
involuntary gifts, for the workings of the capitalist system pro-
duced a series of crises accompanied by bankruptcies which left
much of the exported capital equipment unencumbered by
subsequent financial claims. To this Europe added two wars
partly financed by forced sales of European assets in America.(®)

The Eastern revolutions possess no such advantages. The
forms of international investment have changed. Private inter-
national investment is not so mobile now as it was then, and the
sums, and therefore the risks involved are greater, as the capital
equipment itself has changed its cliaractcr. The machinery
exported to the new world, in the first half of the nineteenth
century, was comparatively primitive compared with the modern
power station, steelworks, factory, railway and irrigation plant.
In these new conditions government lending must take the place
of the private initiative of the old enterprise.

This calls for an imaginative generosity which will tax the
idealism of the developed nations. The United States of America
has already made a contribution, and to a necessarily more
limited extent, so has Great Britain. But these are woefully small
compared with the need, and of late the ability to do more has
been endangered, if not frustrated, by a rearmament programme

MODERN MAN AND MODERN SOCIETY 43

on, in my view, an ill-considered and unnecessarily lavish scale.

Before aid can be given to anything like an adequate extent, the
relationship of the individual citizen to the Great Society will
have to be revised. An international design which is coherent and
purposive cannot be sustained by societies which are themselves
anarchic and without aim.

There are three conceptions of society now competing for the
attention of mankind: the Competitive, the Monolithic, and the
Democratic Socialist. There is a fourth which might be called
the Authoritarian Society, after the fashion of Spain and Portugal,
but in a curious way these last are not genuine societies at all.
They share many of the most repulsive features of the monolithic
type without its active genius. They are frozen socieiies. In so
far as they are animated at all, it is by a nostalgia for a romanti-
cised past. Tlicy arc caught and held by a kind of historical
reverie in which the active principle of progress is debilitated by a
wistful desire to recapture the fixed relationship of the Grandee,
the hidalgo and the serf. In their attempts to reconstruct the
values of the past they constrain the present. They represent the
future refusing to be bom. They reduce the functions of govern-
ment to an ugly masquerade in which the poverty of their pre-
tensions shows throng the tinsel of their ornate fagade. They
need another Cervantes to blow them into oblivion in a gale of
laughter.

That tlie present regime does not represent the people of Spain
is shown by its failure to mobilise their energies in an effective
assault on the nation’s problems. As their history has shown,
the Spanish people are brave, adventurous and freedom-loving.
Left to themselves they would have won their way through. But
their present masters were imposed upon them by the Germany
of Hitler and the Italy of Mussolini, whilst Tory Britain pretended
to hold the ring, although in fact conspiring to keep the anti-
Fascists unarmed.

With the Competitive Society we are sufficiently familiar. We
are just emerging from it, and its “systems of make-believe”, as
Thorstein Veblen called them, still pervade our thinking. Its

44

IN PLACE OF FEAR

philosophy denies to the State any but the most rudimentary
functions in domestic affairs. Collective action is anathema to it.
It believes that good comes from leaving the individual to pursue
what he considers to be his own advantage in industry and
commerce, and that this must be so because people will buy from
him only what they want, and at the price they are prepared
to pay.

Thus individual profit is the motive, and the market the final
arbiter. Competition, we are told, can be safely left to winnow
out the less competent both in production and distribution.
Material success, in this philosophy, is the prize awarded by
society to the individual who has served it best, so the zest for
profit is really a search to discover the wishes of the community.
Though the motive may be selfish the general welfare is served.
Liberal philosophy believed it had discovered in this principle a
method whereby private acquisitiveness and the public weal were
harnessed together in the most fruitful partnership yet evolved by
men.

Poverty was therefore the consequence of failing to serve the
community efficiently and any undue attempt to relieve it would
undermine the hedonism which lay at the heart of this creed. The
kiss of material wealth for the successful; the whip of poverty
for the others. Fear of unemployment was the spur which
compelled the worker to do his best.

From this angle unemployment benefit was regarded with
suspicion because it tended to make the worker more selective in
his choice of employer, and to immobilise him in districts and
countries where the prospects of employment were poor.
Consequently the worker must be kept in a ferment of economic
uncertainty. He must regard his home, his locality, and even his
country as values to which he must not attach his affections too
strongly for at any moment he might have to forsake them and
follow the vaiying rate of profit from employer to employer,
from district to district, from one part of the globe to another.
If the destiny of man is merely to accumulate the means of
production, then there was no previous system to compare

MODERN MAN AND MODERN SOCrETY 45

with it. It produced more changes in the two centuries of
its operation than in the ten thousand years which preceded
it.

But it failed in the one function by which any social system
must be judged. It failed to produce a tolerable home and a
reputable order of values for the individual man and woman. Its
credo was too grossly materialistic and its social climate too
feverish. It converted men and women into means instead of ends.
They were made the creatures of the means of production instead
of the masters. The price of men was merely an item in the price
of things. Priority of values was lacking because no aim was
intended but the vulgar one of the size of the bank balance. It
was satisfied with quantity, oblivious to the fact that a quantita-
tive measurement will pronounce as impersonally on a Shake-
spearean folio as on the latest product of the production line.
Efficiency was its final arbiter— as though loving, laughing,
worshipping, eating, the deep serenity of a happy home, the
warmth of friends, the astringent revelation of new beauty, and
the earth tug of local roots will ever yield to such a test.

And if I am told this is unfair, because it never presumed to
provide a home for man in the widest sense, I reply that that is
just what it claimed to do; it insisted that the best kind of society
would emerge from its individual motivations. In the result it
produced the slums, it broke up the family, it scattered friends to
the distant ends of the earth, it derided the very name of beauty
in the hideous townships it created, it made love furtive, and made
marriage often impossible and frequently an intolerable burden,
and it sundered local association by continuous re-distributions
of the population.

In Britain it was failing before the 1939 war even to mobilise
the forces of production efficiently. Instead of material plenty,
it was conspiring to create scarcity as the condition for making
profits. Today it attempts to enlarge its profits by price associa-
tions, cartels, trusts, resale price maintenance, and a score of
other expedients, all designed to cheat the God by which it swears
in its credo-Competition. In short, it is attempting to enthrone

46

IN PLACE OF FEAR

industrial and commercial authoritarianism in place of the
arbitrament of the market place.

The economic decadence of pre-war Britain was strikingly
revealed when we faced the task of post-war reconstruction.
Most of the basic industries had been geared to the acceptance
of a comparatively low standard of consumption, accompanied
by a permanent army of unemployed numbering about two
million. The coal industry had been rescued from complete
collapse by a series of Statutes all designed to eliminate, not
increase, competition among the various coal companies, and to
enable them to fix the price of coal at a level which would ensure
continued production in high cost pits. This was also true of
steel. In the case of tinplate a rigid cartel served the same
purpose. Outworn techniques prevailed in the textile industry,
and our electricity supplies, as we soon discovered, were utterly
unable to support an all-out production programme.

These statutory protections were in complete contradiction to
what the folklore of British capitalism continued to say about
itself. Private competition was still extolled even as it was being
eliminated from sector after sector of our economic life. Profits
were still accepted as the reward of risk and the prize of eificiency,
although they were now demonstrably often the perquisite of
functionless ownership.

Of course there were large areas of industrial enterprise where
technical discoveries and new industrial techniques showed that
it was the forms of ownership and not the inventive genius of
the British people which were failing.

The technical achievements of the past hundred years have
produced a type of society different from any that has ever before
existed, posing novel problems for mankind. As I said at the
beginning of this chapter, it has changed the character of the
adaptions the individual has to make to his environment. His is
now a straggle with society and not with nature. The vicissitudes
that now affiot him come from what he has done in association
with other men, and not from a physical relationship with the
foro*" of nature. The division of jobour into whinh he i" born

MOUcKN MAN AND MODERN SOCIETY 4/

weaves his own life into a series of interdependencies involving
not only his own personal surroundings, but moving in ever-
widening circles until they encompass most parts of the earth.
Modem industrial society is no longer a multiplication of a
number of simple self-sufficient social groupings, each able to
detach itself from the others without damage to itself. It is multi-
cellular, not uni-cellular. Each part is connected as though by an
infinite variety of nerves with all the others, so that separation is
now a mutilation. It is similar to a physical organism, but with
this difference: that it has no head and therefore no mechanism
with which to receive and co-ordinate the vibrations.

This is so, not only between nations, but within each nation of
the laissez-faire type, because such a philosophy by its very nature
rejects the propriety of an a priori principle. There is no way of
saying how far such a society has realised the intentions of its
architects, because there was no architect and no intention. There
is only an emergent. Science works for predictability: capitalist
society is profoundly unscientific. It proceeds upon no hypotheses,
because that would imply an order of values.

This is why it is so pathetic to hear eminent scientists deplore
the failure of man to rise to the moral stature required of him if
he is to make wise use of the powers science has put in his hands.
Scientists are also citizens. What kind of society do they think
should exist? Should the profit motive serve some other value,
and if so, what is it? If material reward is accepted as the prime
motivator in society then that is an individual prompting, acting
by itself and obeying no generalised moral intention.

From time to time a generalised purpose comes to discipline
the multitude of individual strivings, like war and the preparation
for it under fear of attack, or a struggle for national independence,
in the case of an oppressed nation. On these occasions a moral
unity informs the whole nation and the energies of the people are
supercharged by the absence of inhibitions, as Wilfred Trotter
has brilliantly pointed out.

It is here we come to one of the dangers lurking in the anarchy
of laissez-faire society. The lack of a discernible order of values

48

IN PLACE OF FEAR

to give coolness to judgment and coherence to men’s relations
with each other and with society, gives rise to waves of primitive
gregariousness. The amoral climate of the business world
exposes the psyche of the individual to unreasoning compulsions
inherited from the remote past.

This is one of the explanations why nationalism is so rampant
when the objective facts relegate it to a minor r61e in human
affairs. In place of the sovereignty of rational aims, the primitive
herd instincts assert themselves with threatening violence. In
this mood, questions which can only be settled by changing
relations within the nation are handed over to the field of group
emotions, where the modern witchdoctor hunts out the dissidents,
and the old men of the tribe mouth tlie senile slogans which
passed for wisdom among primitive men.

It has often been said that when revolution threatens, nations
go to war, but that is too simple and rationalised a view. It does
not do justice to what in fact happens. I have seen the alchemy
at work too often not to appreciate the intensity with which relief
is sought from a threatening situation; and from the burdens of
intellectual choice. It is the same impulse that makes men shout
for unity when faced with the need to resolve some painful and
legitimate difference of opinion.

This mood is always difficult to resist because it does not arise
from a rational analysis of the problem. On the contrary,
analysis is what people want to avoid because that would lay
bare the divisions which led to the tensions in the first place.

In Britain the phenomenon has been seen on several occasions
and it is showing itself again. It expresses itself in the demand for
a National Government or for a Coalition and in decrying the
usefulness of political parties. As 1 have said, it is the peculiar
product of the Competitive Society where the individual is reduced
too often to a condition of war with society, and with his fellows,
and consequently where his group impulses are violated.

The effect of gregariousness in these circumstances is to obscure
the nature of the problem. The slum landlord and the slum
dweller, the profit earner and the profit taker, the gambler and

MODERN MAN AND MODERN SOCIETY 49

his victim, the economic adventurer and the advocate of co-
operation, all are summoned together in group consultations and
are bathed in the warm glow which is generated by their close
association. In these conditions it becomes an offence to raise the
issues which divide them, for this would immediately disintegrate
the association which is the source of the group emotions. The
enemy has then to be sought outside the group if its members
are to continue to enjoy the glow of unity. From this to demon-
ology is a short step. Something, someone, must be found against
which the group can launch itself as a united entity.

Nothing does this so effectively as another nation. The genera-
tion of hate against the out-group follows naturally from the
refusal to face the problems which might divide the members of
the in-group. An intense nationalism, belligerent and irrational,
is therefore the natural accompaniment of the Competitive society.
It is the price paid for the emotional collisions which are the
normal conditions of the laissez-faire social system. It is t h is
which gives an underlying sanction in national rivalries to the
squalid aspects of commercial exploitation. Commercial greed
could not commend itself if there was not this craving for group
action in a society where daily struggle in all the important
features of the individual life generates an abiding nostalgia for
mutual co-operation. To expect international co-operation and
peace between societies within which daily life is a jungle strug^e
for existence is not only a contradiction in terms: it is opposed to
any intelligent understanding of the psychology of laissez-faire
society.

It is this as much as economic and commercial antagonisms
between nations which explains why modem industrial society
fights a series of bloody wars even as the facts of international
interdependence point to international co-operation as the only
rational behaviour. Rational thought fights in vain against the
irrational mood which is produced by the endemic economic war
in industry, commerce and finance. The psychology of competi-
tion, and love of peace, are uneasy bed-fellows. The love of
peace is certainly there, but it is overwhelmed time and again

50

IN PLACE OF FEAR

by waves of mass emotion flowing from the countless millions of
little and great frustrations experienced in the competitive struggle
for existence.

The accumulation of material possessions is no compensation
for the rupture between the individual and soeiety that is charac-
teristic of competitive society. Those who succeed in the struggle
equally with tliose who fail are invaded by the universal restless-
ness. The virtues of contemplation and of reflection are at a
discount. jEsthetic values attend upon the caprice of the finan-
cially successful. The price ticket is displayed upon the Titian
and the Renoir, and they are bought more for their prospective
appreciation in capital value than for their intrinsic merit. The
millionaire loots the world of its artistic treasures and then
buries them in his private home, where he can display them to a
few choice friends, whose eyes glisten with avarice rather than
with appreciation of the loveliness and craftsmanship contained
in them. All around there is a restless journeying but with few
arrivals. “Where lies the port to which the ship would go? Far,
far ahead, is all the seaman knows.”

The vulgarity which is so characteristic of modern commercial
civilisation has been a recurrent theme of critics from Ruskin and
Morris onwards, and it is therefore not necessary to enlarge upon
it here. But it is essential to realise that most of the glories of art
were produced for social and not for private consumption. The
skill of architect, sculptor, painter and builder-craftsmen were
united in the construction of public buildings where the cost
counted less than the graciousness they brought to the lives of
those who lived around them. At best the rich collector makes us
a legacy of his accumulated treasures, in which case they are
immured in museums and art galleries, where they look reproach-
fully down on the long processions of sightseers, who can catch,
in such a context, only a small glimpse of their beauty.

Some day, under the impulse of collective action, we shall
enfranchise the artists, by giving them our public buildings to
work upon; our bridges, our housing estates, our oflices, our
industrial canteens, our factories and the municipal buildings

MODERN MAN AND MODERN SOCIETY 5l

where we house our civic activities. It is tiresome to listen to the
diatribes of some modern art critics who bemoan the passing of
the rich patron as though this must mean the decline of art,
whereas it could mean its emancipation if the artists were restored
to their proper relationship with civic life.

I had the dilemma of the artist during a transition stage in
society very much in mind when, as Minister of Health, I was
responsible for a Statute(*) which enables municipal authorities
to spend public monies on educational, artistic and other allied
activities. So far, only a minute beginning has been made in the
exercise of these new powers, for many still labour under the
delusion that this is something that should be left to the private
patron. If that had always been the case, Leonardo da Vinci and
Michael Angelo would have died largely inarticulate.

It might be argued that the Popes, Kings, Dukes and Princes
who patronised them did so because of their private interest in the
arts. That they were so interested is beyond question; at least in
many cases. But it is also true that they disposed of the public
revenues. They were expected to spend part of these in the adorn-
ment and furnishing of churches, the palaces in which they lived,
and the public buildings where the civic life of the community was
carried on. In so far as their private caprice prevailed, it was often
to the detriment of the freedom of the artists they employed.

CHAPTER FOtJR

PRIVATE OR COLLECTIVE
SPENDING

The chief characteristic of the modem Competitive Society is the
feverish accumulation of property in private hands. The stress is
on the word accumulation. In other times individuals acquired
vast fortunes, but these were usually the result of transfers of
already existing wealth, not the creation of new wealth. The
amount of additional wealth created during a generation was
trivial compared with what was inherited; and what was there
to inherit consisted in the main of land. Improvements to the
land in any one generation were microscopic when contrasted
with the growth of capital equipment in a modem industrial
nation. With the possibility of converting agricultural surplus into
commodities to be bought and sold in the rapidly growing urban
communities, the last link with medieval society was broken. This
process, with its pressure on the rural communities to produce
more and more surplus for exchange with the novel manufactured
products, created new tensions between town and country.

In mid nineteenth century Britain the overwhelming proportion
of spending was by the private citizen. Public spending was
reduced to a minimum. This was implicit in the industrial situa-
tion as well as explicit in the philosophy of the time. Wealth had
first to flow through the hands of the private citizen, who was
expected to set aside as much of it as possible for the making of
more wealth. Public spending was seen as an interference, not
only with the rights of the individual, but as an enemy of the
process of capital accumulation. This is still orthodox Conserva-
tive opinion.

Everything was now bought and sold, and the proceeds wore
invested with increasing ardour in the industries which the

PRIVAlB UR COLLU^TIMi IjPENDING

53

Industrial Revolution was calling into existence. Common spend-
ing, communal pleasures, devotion to public elegance, the adorn-
ment of cities, public building, all were seen as diversions from the
all devouring appetite to increase the possibilities of private wealth
opened up by the dqily discoveries of the mechanical sciences.

This is a familiar story, but its deeper significance is only now
beginning to be realised. Private initiative was almost the only
initiative allowed. Government was reduced to its most rudi-
mentary form; the judiciary, and the armed forces which lay at
its back.

There being nothing in the public exchequer which was not
wrung from the reluctant taxpayer, communal need and private
greed were in constant war with each other. The balance of power
lay every time with the taxpayer because he controlled the votes
that elected the Government. Where this was not the case the
cry “No taxation without representation” went up. In obedience
to this demand the franchise was extended. But it would be a
mistake to regard this as democracy on the march, except inciden-
tally. It was rather new wealth on its defence against invasion
by public spending. It was not a demand for more collective
activity, but rather for its curtailment. The public domain must
be restricted or it would slow down, if not stop altogether, the
rate of saving, and therefore the technical progress which was
seen as the main purpose of human endeavour.

There was economic justification behind this attitude. The law
of the new economics was merciless. You had to get richer or
you got poorer. You might have attained to a comfortable
position but you could not rest there. Two factors made it
impossible. In the first place there was your competitor. He
might get ahead of you and push you out of the race. You had to
be on the alert to learn new ideas, improved modes of production,
iind to secure fresh markets. One aspect of the new economic law
was more potent even than that. The new machines coming along
were more expensive to replace than the old. In setting aside
savings regard had to be paid to that contingency. All the time
you had to keep on acquiring more expensive plant or eventually

54

IN PLACE OF FEAR

you would own none. You found yourself sitting on an escalator
which moved ever forwards; and you could not sit still on it;
you yourself had to work the levers that made it move or you
would fall off or be pushed off by others anxious to work them.

It was no wonder that the philosophers of the new order
rejoiced at the situation. Apparently mankind had at last
discovered a form of society in which the individual was com-
pelled to serve the common good in satisfying his own interests.
To this I have already referred. What I wish to emphasise here is
the fact that society had handed over to the individual almost the
entire function of looking after the accumulation of what I have
called its social furniture. But unfortunately it had done it by a
method which produced universal enslavement. Progressive
accumulation of capital goods was now pursued for its own sake.
The accumulators could not stop accumulating.

Nor could they slow down and take time to look around them
to see what it was they had created. “What is this life if full of
care wo have no time to stand and stare,” the Welsh Tramp
Poet asks reproachfully. But the capitalist, bound to his ever-
revolving wheel, was in no position to respond. His only compen-
sation was that the wheel was getting bigger and bigger, and so
in its revolutions he was able to stay just a little longer on
top.

Thus the successful as well as tlie unsuccessful arc unemanci-
pated in the Competitive Society. The only wealth in which the
entrepreneur is allowed to be interested, by the economic function
allotted him, is the wealth that will lead to more wealtli. Con-
sumption for its own sake is made a function of consumption for
further production. All forms of consumption which do not
immediately feed the productive process are looked upon as
uneconomic, as wasteful, as spendthrift. So it was thouglit and
so it was.

But no sooner had the utilitarian principles of capitalism been
universally adopted than men began to revolt against the type
of society they produced. The history of the last hundred years
is the story of how collective action has progressively modified the

PRIVATE OR COLLECTIVE SPENDING

55

situation created by the triumph of money values. No society can
long endure which fails to secure the assent of the people. When
we study the history of human society, especially those forms of
social organisation wliich lasted many centuries, it is difficult for
us to understand how it was that men and women came not only
to tolerate, but cheerfully to acquiesce in, conditions and practices
which seem to us at this distance to be revolting. The answer is
not the simple one that the masses were held down by sheer
physical force. That is possible for a short time: but it cannot
explain the continuity of centuries of the same conditions. The
institutions and modes of behaviour of these societies must have,
in part at least, commended themselves to ordinary men and
women or they would have been undermined by sheer disapproval.
Ultimately, rulers, however harsh, must share the same values as
the ruled if their empire is to persist. Obedience is rendered in
the last resort, and for any considerable length of time, by accept-
ing the moral and intellectual sanctions that lie behind social
compulsions. To represent the history of mankind as a record of
sullen submission to alien values, at the threat of the whip, and
the fear of the executioner, is to affront our intelligence as well as
to offend the dignity of human beings.

Thus there must always have been compensations and amenities,
pleasures and common rituals, making life seem worth while and
forming the cement that bound ancient societies together in a
continual reaffirmation of willing consent.

Such consent capitalist society has not been able to secure in
any country where it has won a complete victory. If I am told
that the United States of America is a rebuttal of this contention,
then I answer that history has yet to pronounce the verdict on her.
She has lasted too short a time to claim that the principles which
dominate Her life have the quality of permanence. What we are
able to say is that where the same principles triumphed in the
countries of Europe they have been or are being deserted and in
some instances completely overthrown.

This is not difficult to understand. The record is immediately
behind us for the reading. The reason for the impermanence of

56

IN PLACE OF FEAR

capitalist society consists in the fact that it is merely an accumula-
tion of private values and these take no account of the common
values that are the essential condition for social survival and
continuity. Disposal of the economic sujTplus is a function that
should belong to the sphere of collective action. It is this that a
system of private economic adventure is quite unable to concede:
except in the case of war and the preparation for war when
group sanctions over-ride private ambitions.

I know this will be regarded as heresy of the worst kind: and
yet I must persist because in my view it lies at the heart of the
modem problem. So long as the function of progressive accumu-
lation remains the field of private initiative, the individual will
never be able to make society conform to any permanently
commendable pattern.

Where public spending is looked upon as an invasion of private
rights, private ambitions are the enemy of any reputable system of
social priorities. Even in Britain, where as much as one fifth to
one fourth of the national income is devoted to capital investment,
complaint is made all the time that the high rate of taxation is
interfering with fresh investment. The complaint is not really
of the rate of investment but of its direction. The demand is
always that the nature of the investment as well as its amount
should be left to private initiative.

The argument that public spending is at the expense of savings
and therefore of new capital accumulation is subtle and per-
suasive, The Government is made to appear thriftless and
improvident and careless of the needs of posterity. This charge
is advanced incidentally by people whose improvidence has
devastated whole provinces of their woodlands, and produced
soil erosion of gigantic proportions, and who are now in the
process of using up stores of precious melals so prodigally that
minerologists ate raising shouts of unheeded warnings.

Public spending is presented as an extravagance; private spend-
ing, by inference, an economy. So long as the disposal of the
economic surplus is considered a function of privately inspired
investment this must always be so, for private ambitions are set in

PRIVATE OR COLLECTIVE SPENDING

5/

conflict with public plans, and personal frustrations embitter the
quarrel. Some Conservatives have carried their protests to an
absurd extent. One of them, when challenged as to what public
e.\penditure he would cut, answered “Technical education”. This
shocked me at the time into calling the Conservatives “Devourers
of the seed”.

Taxation, unaccompanied by selective subsidies, is not an
effective instrument for remedying social inequalities except in
comparatively small quantities, and gradually over long periods
of time. And this for a reason that is often ignored. A sudden
heavy tax which transfers purchasing power from one section of
the community to another may change the pattern of consumable
demand so violently as to produce a sharp rise in prices. It is true
that over a period the high prices will call forth more production
in the goods required. But in modem society the period can be
too long, for capital is locked up in the old pattern of distribution.
This is especially the case where nature fixes a rhythm that cannot
be hurried, as for instance, in the production of meat and milk.

A change in consumable demand, if it is to be effected with
least dislocation, should be preceded by an alteration in the
direction of investment; and this is most easily done by the
authority responsible for the change in the first place.

In Britain the co nfl ict between private and public investment
after the war brought into prominence the point I am here
making. It illumines the difficulties that arise when social
priorities are injected into a system where most of the surplus
available for new investment is still privately owned. The after-
ma th of war left us with certain forms of investment which had
prior claims on the national resources.(^) There was housing for
example, and coal mines, steelworks, and power stations, a wide
variety of factories no longer adequate to the needs of a Britain
in full employment; higher imports involving higher exports. It
was comparatively easy to plan the public sector of our national
expenditure, and to keep within the figures agreed, because public
expenditure was under immediate control by Ministers and State
departments. I would find myself, for instance, as Minister of

58

IN PLACE OF FEAR

Health, allotted a sum of money for such public necessities as
water supplies and sewerage, I had to keep to this figure within
narrow margins of at most thousands of pounds. The physical
work as well as its money equivalent was well within public
control, being a function of the Health Department and the local
authorities. The end result was therefore predictable. But in the
private sector the national plans were out by scores of millions;
in commercial vehicles alone, in one year, by many millions.
The explanation was that these had been produced for export
but could not at the time be sold overseas. The producers could
not afford to hold them and so they had to be disposed of on
the domestic market.

Was this a failure of public planning? Of course not. On the
contrary, the public sector kept strictly witliin its proportion of
the national investment programme; too strictly, I sometimes
thought. It was the unpredictable and uncontrollable private
production and sale that went astray. The relort can justly be
made in the instance given, that the private producer was engaged
in the export trade where the conditions are more uncertain and
less within the control of the operator. All this is true, but the
damage was done before we could catch up with the results: and
these were serious and cumulative. The carefully arranged
priorities went all wrong. The British roads were thronged with
expensive charabancs, lorries and trailers, all adding to the
national cost of transport; and this at a time when more essential
forms of consumption were denied the population.

That last sentence brings us up against one of the central issues
posed by modem society. What is most essential and who is to
decide it?

What are the most worthy objects on which to spend surplus
productive capacity? For the sake of simplicity I am accepting
the existing pattern of production and consumption, although by
no means do I agree with it. After providing for the kind of life
we have been leading as a social aggregate, diere is an increment
left over that we can use as we wish. What would we like to do
with it?

PRIVATE OR COLLECTIVE SPENDING b9

Now the first thing to be noticed is that in the Competitive
Society the question is never asked. It is not a public question at
all. It cannot be publicly asked with any advantage because it
is not capable of a public decision which can be carried out.
Therefore in this most vital sphere, the shaping of the kind of
future we would like to lead, we are disfranchised at the very
outset. We are unable to discuss it because the disposal of the
economic surplus is not ours to command. This means, as I have
pointed out in previous chapters, that whereas we consider the
world of nature capable of being subordinated to our will, society
is left uncharted and therefore unpredictable. Where society is
to go from here does not lie within the competence of any assembly
of statesmen, in any part of the capitalist world, so long as the
assumptions of competitive capitalism remain unchallenged. The
surplus is merely a figure of speech. Its reality consists in a
million and one surpluses in the possession of as many individuals.
Political economy is a study of how the surpluses have been
disposed of, and consequently of how they are likely to be dealt
with in the future. It is not a science of what should happen to
them. That belongs to the world of morals.

If we reduce the question to the realm where we have brought
it, that is to say, to the individual possessor of the surplus, the
economist will provide us with a ready answer. He will tell us
that tire surplus owner will invest it in the goods for which he
thinks there will be a profitable sale. The choice will lie with those
able to buy the goods the owner of the surplus will proceed to
produce. This means that those who have been most successful
for the time being, that is the money owners, will in the sum of
their individual decisions determine the character of the economy
of the future. This is an extremely simplified version of what
actually happens, but nevertheless, it is the core of the defence of
laissez-faire economics.

At fcst sight this seems a satisfactory answer to our question.
In fact it answers both questions; what is most desirable and who
decides it? The one who decides is the one who has been most
successful. That seems all liaht. What can be more reasonable

60

IN PLACE OF FEAR

than that the successful should shape the future? Would you
have the failures decide it? That would be merely sour grapes.

There are a wide range of answers that could be made and
indeed have been made to these questions. There is, for example,
the argument that many of tlie successful are only so because they
happen to be the children of their parents and have inlierited
success rather than achieved it. From this it follows tliat the
failures are so because they selected the wrong parents. Then
there is the old socialist argument, always potent, that mere
survival is not a test of superior virtues, for in that case, in a
swamp, flies would be superior to men. Some possessors of money
have got it by sharp practice, others by gambling, yet others by
nepotism and still more by social connections. The list is endless.

But the final answer does not lie in any of these or in all of
them combined. The answer consists in the fact that the kind of
society which emerges from the sum of individual choices is not
one which commends itself to the generality of men and women.
It raust be borne in mind that the successful were not choosing a
type of society. They were only deciding what they thought could
be bought and sold most profitably. Nothing was further from
their mind than making a judgment on the kind of society that
mankind should live in. That question is no more posed for them
than it is for the social group as a whole, in laissez-faire society.

There are many reasons why capitalist society does not com-
mand the assent of the masses. There is to begin with the sense of
injustice arising from gross inequalities. This is a fertile source
of discontent and will always render capitalist society unstable.
But I do not consider this by itself as fatal to the existing order.
There have been inequalities throughout the history of mankind,
but they have not always proved incompatible with a certain
degree of social stability. Complete equality is a motive that has
never moved large masses for any decisive length of time. It has
inspired sects and special Orders but it does not appear to be a
condition congenial to normal living. There are probably causes
deep in the human psyche to explain this, but they lie outside the
province of this book. A sense of injustice does not derive solely

PRIVATE OR COLLECTIVE SPENDING 61

from the existence of inequality. It arises from the belief that the
inequality is capricious, unsanctioned by usage and, most
important of all, senseless.

It is commonly said that we are all born unequal, but surely
that is the wrong way of expressing it. True we are bom of
parents who occupy different positions in society; and therefore
children start their lives with varying advantages. But that is a
difference of social situation and not intrinsic in the children. It
would be more correct to say that we are bom with different
potential aptitudes, than that we are bom unequal. How these
will develop and show themselves will depend upon the kind of
social complex we get into- Whether the special aptitudes,
qualities or temperament we are bom with turn out to be of later
advantage, and place us higher in the social scale than others,
will turn upon whether they are sufficiently cultivated, and
equally important, whether they happen to be of the sort our
particular kind of society finds valuable. Different dispositions
at the start will result in different social status at the end to the
extent that they are favoured by circumstance. In this I am
ignoring for the moment the advantages conferred by class and
wealth.

The expression that we are bom unequal is tendentious because
it implies that social rank is biologically decided for us at the
outset. Our differences are acted upon by different sorts of social
soil. Some flourish whilst others languish. The fault often lies
“in our stars” and not in us.

I have not found workers resent hi^er rewards where they
manifestly flow from personal exertion and superior qualities.
Thus piece-work is universally accepted if its incidence is fair and
expresses the result of harder or more skilful work. We all
applaud proper recognition for the scientist, the artist and the
inventor. Nor indeed is there as yet a disposition to object to the
higher incomes awarded certain of the professional classes. But
here qualifications are beginning to be heard. It was always
accepted that professional social standards should be hi^er than
the general standard because so many unremunerative years had

62

m PLACE OF FEAR

to be spent at school and university to fit the student for future
work. The higher income was a compensation for earlier depri-
vation of income. The situation has clianged and continues to
change quite markedly. A high percentage of professional
students are now educated at the expense of public funds,
and during their student years tliey enjoy a tolerably com-
fortable standard of life unenemnbered by the debts they
formerly had to incur. This is bringing about a shift of opinion
among tliosc engaged in what are considered the humbler manual
occupations. When the fimds for training were provided by
mortgaging the future, or by great sacrifices on the part of the
parents of the student, there was an obvious social sanction for
the higher income Ievels.(®) In present circumstances, there is no
disposition to lower professional living standards. That would be
a retrograde step and is opposed to tire climate of opinion in all
classes. But there is a very definite feeling that the gap should be
narrowed and that the lower income groups should be allowed to
catch up a little.

In the meantime the assumptions which attach themselves to
those in the higher income groups arc as assertive as ever. It is
not unusual to hear members of the professions complain that
some piece-work miners are able to earn almost as much as them-
selves. It does not seem to occur to them that their own jobs are
more attractive, and what is even more to the point, becoming
more accessible than formerly; and that consequently there is no
longer the same justification for differential income levels.

Working-class families often slcimped and saved to send a
bright son or daughter to university. The student led a frugal life,
often doing odd jobs, when these could be got, and working with
his family in the holidays. In my own family, my brothers and I
went down the pit on leaving elementary school, but our sisters
were sent to college. This quite often happened in the mining and
steel districts of South Wales. The girls were trained for school
teaching largely because there were no jobs open to them in areas
given over almost entirely to heavy industry.

In my recollection we did not envy our sisters. On the contrary.

PRIVATE OR COLLECTIVE SPENDING

63

we took pride in their scholastic success. In return it often
happened that the family budget was helped in later years if
professional posts could be found at or near the family home.
This was part of the texture of family life among the artisan
community. When the bad years came and unemployment cut
cruelly into our already limited resources it became more difficult.
But even then it was surprising how tenaciously we clung to the
hope of superior educational opportunities for those of our
family who could benefit by them.

In many respects the situation is different today. Pi-ofessional
careers are more common. Educational authorities and the State
have loosened their purse strings to such an extent tlmt the
majority of university places are provided by public monies. The
family contribution is now the least important factor in meeting
the expenses of academic training. What was formerly a private
sacrifice is now a public benefaction. The young worker in
industry now pa!ys for the academic training of those able to
enjoy it. There is nothing wrong in this. Indeed it could not be
otherwise. Some have to work whilst others learn. But it does
cast doubt on the traditional reasons why there is such a gap
between the social standards of the professional classes and those
of the other occupations whose abstinence from consumption it
is that supports the revenues of the universities.

The standard of life of the student is higher than that of tlie
industrial worker who maintains lum. He usually lives in more
congenial surroundings, and his holidays are more generous than
the week or fortnight the industrial worker has only just managed
to get inserted into liis contract with his employers.

Nevertheless when the professional worker completes his
training liis expectations are based on traditional values that are
losing their old validity. This is beginning to produce tensions
in unexpected directions. Many of ihe professional classes have
retirement pensions and emoluments attached to their professions
and these are on a scale commensurate with their salaries. The
retirement pensions of the majority of the industrial population
are those fixed by National Insurance. The disparity is obvious.

64

IN PLACE OF FEAR.

Many trade unions ate moving to remedy tliis anomaly. But as
some industries are more favourably situated in this respect than
others, the result is bound to produce a great deal of heart
burning.

The situation is not made easier by virtue of the fact that
occupational retirement schemes contain early retirement ages,
partly because of the old bogey, fear of unemployment, and
partly because an older retirement age would retard promotion.

This is a special problem in itself. It is too wide a subject to be
exhausted here. But it is relevant to call attention to the fact
that the conventions which have grown up around the social
expectations of salary and wage-earners no longer correspond as
much as formerly with the objective facts. There is no quick and
easy solution. Too much dislocation would be caused thereby.
What can be expected is a shift in opinion, or it will become even
more difficult to man up industrial occupations to which out-
moded conceptions of status and reward still attach.

Resentment against inequality occurs when it quite clearly
flows from social accident, such as inherited wealth or occupa-
tions of no superior social value. The mere ownership of properly
is not a social service in itself. Nor is great wealth possible by
personal exertions and qualities alone. It derives from the power
to exploit the exertions of others. This is a predatory power made
possible by carrying over into modem society the concepts of
barbarism, when theft, raid and pillage were accepted ways of
acquiring property. It was even tolerable and carried with it a
certain justification in the early days of capitalist society where
the personal element was still a significant factor in the process of
capital accumulation. This is no longer the case except in small
businesses.

No one in modem industrial society starts off with nothing.
He inherits, as a citizen, a vast plexus of industrial techniques
piled up by the whole past of mankind. Wlien, therefore, a so-
called self-made man boasts that he started with nothing and
carved out a fortune for himself he is talking unmitigated
nonsense. If he had had nothing but himself he would have

PRIVATt OR COLLECTIVE SPENDING

ended up with nothing. What in fact happens is that each of us
stands on the shoulders of the past, a past which includes all the
great names in history. Such knowledge as we possess is trans-
mitted to us by the medium of a more and more complex sodal
organisation. The scientist whose achievements we now set out to
exploit would never have made the arrogant assertion that he
had started olf with nothing. He had himself painfully acquired
the accumulated corpus of knowledge in his own particular field
and proceeded to add his own contribution, big or little, as the
case might be.

It is no answer that a great industrial society like the United
States still makes it possible for individuals to amass great
fortunes. The fortunes rarely if ever correspond to the contri-
bution their owners have made either to the material wealth of
the community or to its well-being in other directions. They
represent the reward in most cases of concentrated acquisitive-
ness. Their owners manage to get a favoured position on the
banks of the streams of wealth flowing through the community
and suck up greedily as much as they can before they are edged
out by stronger rivals. The effort they make to get into that
position, and to hold it as long as possible, deceives them into
thinking they have worked hard and tirelessly for what they get.
And so they have, as their duodenal ulcers testify. But if effort
alone is enough to justify great wealth, a burglar is on the same
basis as a millionaire. What matters is the social utility of the
effort, not the effort itself. The subjective consciousness of
exertion is no test of its objective merit.

What we are witnessing is the private acquisition of wealth
socially produced. And not only is the wealth itself a product of
social teamwork, but the ideas that lead to new wealth are now
the result' of many trained workers acting in concert. It is true
that one will get an inspiration that may lead to new agents of
production and promising themes for further exploration. But
the inspiration will be an evocation induced by co-operative
effort. It is possible to list a long series of inventions produced
in this way. But it rarely happens that those engaged in experi-

66

IN PLACE OF FEAR

ment and research, and eventually discovery, are the ones who
amass huge fortunes. These are usually achieved by a different
type of individual altogether. The prototype of the successful
man in modem industrial society is not the scientist, the inventor,
the scholar. It is the financier, Ihe gambler, and those with social
pull. The others share sometimes, it is true, but their share is
modest compared with the oligarchs and tycoons; and they don’t
usually keep their share for long. They are no match for the
commercial prowlers.

Thus there is a sense of injustice in modem society and this
induces a feeling of instability even in normal circumstances.
The rewards are not in keeping witli social worth, and the con-
sciousness of this, both among the successful and the unsuccessful,
will simmer and bubble, blowing up into geysers of political and
social disturbance in times of economic stress.

But as 1 said earlier, I do not think the existing social order is
threatened with destruction from this source alone. The chief
causes of instability in capitalist society are tmemployment and
the fear of it; resentment against preventable poverty; de-
personalisation of the worker and, of course, war. With the
problem of wax I shall deal in a separate chapter.

The beUof that poverty is preventable is a natural outcome of
the triumphs of the machine ago. It is a relatively new mood for
mankind. It has been a ferment working in the minds of the
masses of Europe ever since the Industrial Revolution emanci-
pated the individual from reliance upon his own muscular power
supplemented by his domesticated animals. It has now spread
to the Orient. Its consequences will not be exhausted there this
century. There is at present a spate of books seeking to prove
that the growth of population in the Oriental countries, if it
continues, will make it impossible to maintain even the existing
standards of consumption. A new Malthusianism is in the air.
There are those who prophesy starvation for two thirds of the
human race, and at the same time the West pours torrents of
wealth into the creation of a vast war machine. But of that
liter.

PRiVAli. OR COLLBcmt SPENDING

6/

The belief that poverty was the inescapable lot of man served
as a social cement throughout most of human history. “By the
sweat of thy brow shalt thou eat thy bread,” uttered as a curse,
ended by being a discipline; the most effective discipline of all;
more potent than armies and prisons, the frown of authority,
the exliorlations of the priests. It carried more weight than all
these combined just because it was so obviously true. And
being true it sot a limit to the possibilities of political disturbance
and social upheaval. Even today the argument that an equal
distribution of existing wealth would not raise the average by an
appreciable amount has considerable potency. How much more
so was this the case when all there was to divide was infinitesimal
compared with the immense wealth of modem society. It kept
the poor in subjection because even successful rebellion could
not serve to mitigate the rigours of toil by anything much that
could be measured. It begot quietism, and even the mortification
of the flesh, all the more so when there was not much flesh to
mortify.

Against a drab background of universal poverty, the pomp and
circumstance of barbarism was the only source of colour and
pageantry, ritual, exaltation and a certain elevation of the spirit.
A million small contributions went to the building of a cathedral,
a mosque, a temple, a pyramid, or a great mansion. But when
they had been created th^ served to enrich many individual lives
that would have remained unillumined if the collective effort had
not been made.

Ill time people came to resent the exactions that made such
splendour possible. But it is interesting to observe that their
resentment grew as they became more able to afford to be
resentful. Nor is this difficult to understand. As their individual
lives grew more urbane they were less dependent on the mass
provision of colour and pageantry. It seems to be a part of
normal psychology to resent loss of savings as much or more
than loss of earnings. This is probably because the self-denial
that went to the savings endear them more.

With the conviction that poverty was no longer inescapable, the

68

IN PLACE OF FEAR

“framework of the past”, to use H. G. Wells’ phrase, was broken.
Philosophy and religious resignation gave plaee to rebellion and
self-assertion. The flood-gates were open. They are still open;
and now right throughout the world. “If some Richelieu does
not stem ihe torrent of private judgment,” cried Madame de
Renal to Julien in Stendhal’s Rouge et Noir, “all is lost.” The
torrent is still flowing, but now private judgment is increasingly
aimed at the social barriers erected against the conquest of poverty.

Tt is possible that in tlie United States of America the argument
still holds good that private economic adventure offers the best
means for the development of industrial techniques; but in
Europe tlie belief no longer holds. The arteries of capitalism in
Europe have hardened. The assault on poverty is now recognised
more and more as a collective operation with private activities
playing a subordinate rdle. It is one of the ironies of life that
insistence on state, collective, or communal action — call it what
you will — is fostered by American intervention. With Marshall
Aid went a demand that it should be used to rejuvenate European
industry. It did not seem to occur to the stout supporters of
private enterprise in the American Senate that they were asking
for the virtual abandonment of uncontrolled private enterprise.
They demanded a plan. Now if there is one thing you cannot
plan it is competition. Of course you can have competitive
planning and that is apparently what Italy, for example, has been
doing: with results that can hardly be described as happy.(®)

The fact must be faced that Europe will never return to the
practices, conventions and principles of pre-war. There is not
only political paralysis in Western Europe; there is a profound
lack of confidence in conventional values; and this is true for all
social classes. This is accompanied by a deep spiritual malaise
arising from a prolonged hesitancy to choose between a number
of proffered alternatives. It is probably true that Western
Europe would have gone Socialist after the war if Soviet behaviour
had not given it too grim a w'sage. Soviet Communism and
Socialism are not yet suffldently distinguished in many minds.

The large Communist votes in Western Europe, especially in

PRIVATE OR COLLECTIVE SPENDING 69

France and Italy, are evidence that millions of men and women do
not believe that competitive private enterprise has any future; at
least of a sort that would commend itself to them. It is extremely
doubtful whether the Communist vote is a vote for Communism.
It is partly a protest vote and partly a demand for Democratic
Socialism after the fashion of the first five years of the British
Labour Government.

It was the promise to abolish preventable poverty that helped
people to tolerate all the manifold injustices and shortcomings
of capitalist society, just as it was the belief that it could not be
abolished, that protected the social classes from suicidal collision
in previous societies.

With the discovery that capitalism was failing in the very sphere
where it was thought to be triumphant, the end of competitive
industrialism was merely a question of time. This failure was
apparent in Great Britain in tlie years between the two wars, as
I have mentioned briefly in a previous chapter, but an illustration
from ray own experience may present the point less abstractly.

The constituency I represent in Parliament belongs to the
district which was the cradle of heavy industry in Britain. Ebbw
Vale, Tredegar, Dowlais, Merthyr Tydfil, Rhymney, all these are
names familiar to students of the Industrial Revolution. They
possessed most of the requisites for heavy industry; coal, iron
ore, limestone. As time went on the iron ore was exhausted and
this was held to justify the recession of heavy industry from these
parts. The explanation is only partly true. They are only twenty
miles from the coast, and as our iron ore had now to come from
abroad in the main, a twenty mile haulage cannot be held to
justify uprooting whole townships with all that is involved in
such an operation. Some may say this is a parochial view
induced by local aflSliations and the natural reluctance of a
Member of Parliament to witness the migration of his con-
stituents. As the argument develops the reader will see there is
more in it than that. A twenty-mile transport problem for the
conveyance of only one element in the industrial process should
not lead to the destruction of so much social equipment. Nor

VO IN PLACE OF FEAR

would this happen if the same authority was responsible for the
social as well as the industrial capital. But the social capital was
a communal preoccupation, whilst the industrial capital was a
private one. If the social cost of transfer was added to the cost
of the new works on the new site, the economics would work out
difiForcntly. But this is not my immediate concern here.

If the migration of industry had served the purpose of an
expanding steel industry, the dislocation of so many people’s lives
miglit have been tolerable. But this was not the case. Private
initiative in British steel production was exhausting itself. Old
out-of-date steel plants were kept ticking over by means of bank
overdrafts. London finance was not concerned with preserving
the foundations of British industry. That was not its responsi-
bility. But at this point an essay in collective action was tried.
Under the direction of Mr, Philip Snowden, then Labour
Chancellor of the Exchequer, the Bank of England was persuaded
to establish a Bankers’ Industrial Development Corporation to
provide finance mainly for steel undertakings that could not
raise money in the open market. The prospect of profit had failed
the British Steel Industry. Other motivations had to take its
place.

It is necessary to emphasise that we are here speaking of
nothing less than the survival of Great Britain as an industrial
power; and that means the survival of her teeming population.
Competitive enterprise in Britain had run into a cul de-sac from
which it had to be rescued by State action. But this is only part
of the story. Worse is to come.

The Corporation found the necessary finance for the recon-
struction and re-equipment of a number of steel undertakings
that are now flourishing. Unfortunately, Ebbw Vale was not
among them. This led me to seek an interview with the Chancellor
of the Exchequer, who by then was Mr. Neville Chamberlain.
He in his turn sent me to the Secretary to the Treasury, who in his
turn passed me on to the Secretary to the Development Corpora-
tion. At last I was interviewing the official supposed to be engaged
in rebuilding the steel industry of Britain both for present and

PRIVATE OR COLLECTIVE SPENDING /I

future needs. The conversation was illuminating. He was an
extremely able man. What he could do he did very eiRcicntly. But
he had to work within the limits of policy laid down for him.
When I asked about the prospects of finance to put the Ebbw
Vale steel plant back into modem steel production he shook his
head. “Impossible,” he said. That was bad enough. But the
reason he gave was worse. It was not, as you might think, that
Ebbw Vale was badly sited, and that a new steel works shoidd go
elsewhere. As I have said there was an argument for tliis, though
in my opinion a bad one. No, the reason he gave was that his
advisers saw no market prospects for any more steel works in
Great Britain in addition to the ones already in their schemes.
Apparently we had reached the maximum steel production for
which there seemed any prospect of profitable consumption.
What was that? It was somewhere in the region of ten to eleveir
million tons per annum, much of it from obsolete plants with
high production costs.

An industrial economist had just made a calculation that if
we in Britain at that time were using steel to the same amount
per head of population as the United States of America we should
be consuming nineteen million tons per annum. Yet our steel
production was to be stabilised at ten to eleven millions. And
this with thousands of steel workers idle, and unlimited tasks
left undone for want of steel and its ancillaries.

We have now climbed to between sixteen and seventeen million
tons per year, mainly under national direction and control, and
there is still a distance to travel if Britain is to play its proper part
in the world.

The bleak sequel was that during the war we had to convey
precious steel with the loss of still more precious lives across the
Atlantic; and Britain’s industrial recovery after the war was
slower and more expensive in foreign dollar currency than it need
have been. There was no justification for the smugly complacent
advertisements which have appeared in the British Press ever
since the war. These were intended to convince the British people
that all was well in the world of steel and that whatever else we

/2 IN PLACE OF FEAR

lacked, these far-sighted, efficient and enterprising steel masters
could be relied upon to serve the needs of the nation in war and
peace. Certainly technical knowledge we had in abundance and
the men to apply it. But we had failed to realise that in Britain,
at least, the propulsions of private economic adventure had lost
their force. Excessive caution had taken the place of self-confi-
dence: we had organised scarcity and high profits instead of
expanding production and the acceptance of risk.

The same story is true in their different ways of coal and textiles,
power stations and oil refining plants.(*) If private enterprise
had been left to its own devices the standard of living of the
British people would be lower than it is today, and the prospects
for the future grim indeed for the population of this island.

We have escaped from the greater poverty that would have been
our fate. But not by the automatism of private competition so dear
to the heart of some economists. These had demonstrably failed.
Public intervention at one point after another alone served to
protect us from the industrial lethargy which had overtaken
vital areas of our economy.

CHAPTER FIVE

A FREE HEALTH SERVICE

The field in which the claims of individual commercialism come
into most immediate conflict with reputable notions of social
values is that of health. That is true both for curative and
preventive medicine. The preventive health services of modem
society fight the battle over a wider front and therefore less
dramatically than is the case with personal medicine.

Yet the victories won by preventive medicine are much the
most important for mankind. This is so not only because it is
obviously preferable to prevent suffering than to alleviate it.
Preventive medicine, which is merely another way of saying
health by collective action, builds up a system of social habits
wliich constitute an indispensable part of what we mean by
civilisation. In this sphere values that are in essence Socialist,
challenge and win victory after victory against the assertions and
practice of the Competitive Society.

Modem communities have been made tolerable by the
behaviour patterns imposed upon them by the activities of the
sanitary inspector and the medical o£5cer of health. It is true,
these rarely work out what they do in terms of Socialist philosophy ;
but that does not alter the fact that the whole significance of their
contribution is its insistence that the claims of the individual shall
subordinate themselves to social codes that have the collective
well-being for their aim, irrespective of the extent to which this
frustrates individual greed.

It is only necessary to visit backward countries, or the backward
parts of even the most advanced countries, to see what happens
when this insistence is overborne. There, the smaU well-to-do
classes furnish themselves with some of the machinery of good

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IN PLACE OF FEAR

•/4

sanitation, such as a piped water supply from their own wells,
and modern drainage and cesspools. Having satisfied their own
needs, they fight strenuously against finding the money to pay
for a good general system that would make the same conveni-
ences available to everyone else.

The more advanced the country, the more its citizens insist on
a pure water supply, on laws against careless methods of preparing
and handling food, and against the making and advertising of
harmful drugs. Powerful vested interests with profits at stake
compel the public authorities to fight a sustained battle against
the assumption that the pursuit of individual profit is the best
way to servo the general good.

The same is true in relation to contagious diseases. These are
kept at bay by the constant war society is waging in the form of
collective action conducted by men and women who are paid
fixed salaries. Neither payment by results nor the profit motive
are relevant. It would be a fanatical supporter of the Competitive
Society who asserted that the work done in the field of preventive
medicine shows the enslavement of the individual to what has
come to be described in the U.S.A. as “statism”, and is therefore
to bo deplored. The more likely retort is that all these are part
of the very type of society I am opposing. That is true. But they
do not flow from it. They have come in spite of it. They stem
from a different order of values. They have established them-
selves and they are still winning their way by hard struggle. In
claiming them, capitalism proudly displays medals won in the
battles it has lost.

When we consider the great discoveries in medicine that have
revolutionised surgery and the treatment of disease, the same
pattern appears. They were made by dedicated men and women
whose work was inspired by values that have nothing to do with
the rapacious bustle of the Stock Exchange: Pasteur, Simpson,
Jenner, Lister, Semelweiss, Fleming, Domagk, Roentgen — ^tho
list is endless. Few of these would have described themselves as
Socialists, but they can hardly be considered representative types
of the Competitive Society.

A FREE HEALTH SERVICE

75

The same story is now being unfolded in the field of curative
medicine. Here individual and collective action are joined in a
series of dramatic battles. The collective principle asserts that
the resources of medical skill and the apparatus of healing shall
be placed at the disposal of the patient, without charge, when he or
she needs them; that medical treatment and care should be a
communal responsibility; tirat they should be made available to
rich and poor alike in accordance with medical need and by no
other criteria. It claims that financial anxiety in time of sickness
is a serious hindrance to recovery, apart from its uimecessary
cruelty. It insists that no society can legitimately call itself
civilised if a sick person is denied medical aid because of lack of
means.

Preventable pain is a blot on any society. Much sickness and
often permanent disability arise from failure to take early action,
and this in its turn is due to high costs and the fear of the effects
of heavy bills on the family. The records show that it is the
mother in the average family who suffers most from the absence
of a free health service. In trying to balance her domestic budget
she puts her own needs last.

Society becomes more wholesome, more serene, and spiritually
healthier, if it knows that its citizens have at the back of their
consciousness the knowledge that not only themselves, but all their
fellows, have access, when ill, to the best that medical skill can
provide. But private charity and endowment, although inescap-
ably essential at one time, cannot meet the cost of all this. If the
job is to be done, the State must accept financial responsibility.

When I was engaged in formulating the main principles of the
British Health Service, I had to give careful study to various
proposals for financing it, and as this aspect of the scheme is a
matter of anxious discussion in many other parts of the world,
it may be useful if I set down the main considerations that guided
my choice. In the first place, what was to be its financial relation-
ship with National Insurance; shoidd the Health Service be on an
insurance basis? I decided against this. It had always seemed to me
that a personal contributory basis was peculiarly inappropriate

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IN PLACE OF FEAR

to a National Health Service. There is, for example, the question
of the qualifying period. That is to say, so many contributions
for this benefit, and so many more for additional benefits, until
enough contributions are eventually paid to qualify the contri-
butor for the full range of benefits.

In the case of health treatment tliis would give rise to endless
anomalies, quite apart from the administrative jungle which
would be created. This is already the case in countries where
people insui'e privately for operations as distinct from hospital
or vice versa. Whatever may be said for it in private insurance,
it would be out of place in a national scheme. Imagine a patient
lying in hospital after an operation and ruefully reflecting that if
the operation had been delayed another month he would have
qualified for the operation benefit. Limited benefits for limited
contributions ignore the over-riding consideration that tlie full
range of health machinery must be there in any case, independent
of the patient’s right of free access to it.

Where a patient claimed he could not afford treatment, an
investigation would have to be made into bis means, with all the
personal humiliation and vexation involved. This scarcely
provides the relaxed mental condition needed for a quick and
full recovery. Of course there is always tlie right to refuse treat-
ment to a person who cannot afford it. You can always “pass by
on the other side”. That may be sound economics. It could not
be worse morals.

Some American friends tried hard to persuade me that one way
out of the alleged dilemma of providing free health treatment
for people able to afford to pay for it, would be to fix an income
hmit below which treatment would be free whilst those above
must pay. This makes the worst of all worlds. It still involves
proof, with disadvantages I have already described. In addition
it is exposed to lying and cheating and all sorts of insidious
nepotism.

And these are the least of its shortcomings. The really objec-
tionable feature is the creation of a two standard health service,
one below and one above the salt. It is merely the old British

A FREE HEALTH SERVICE

77

Poor Law system over again. Even if the service given is the same
in both categories there will always be the suspicion in the mind
of the patient that it is not so, and this again is not a healthy
mental state.

The essence of a satisfactory health service is that the rich and
the poor are treated alike, that poverty is not a disability, and
wealth is not advantaged.

Two ways of trying to meet the high cost of sickness are the
group insurance, and the attachment of medical benefits to the
terms of employment. Group insurance is merely another way
of bringing the advantages of collective action to the service of
the individual. All the insurance company does is to assess the
degree of risk in any particular field, work out the premium
required from a given number of individuals to cover it, add
administrative costs and dividends, and then sell the result to the
public. They are purveyors of the law of averages. They convert
economic continuity, which is a by-product of communal life,
into a commodity, and it is then bought and sold like any other
commodity.

What is really bought and sold is the group, for the elaborate
actuarial tables worked out by the insurance company are
nothing more than a description of the patterns of behaviour of
that collectivity which is the subject of assessment for the time
being. To this the company adds nothing but its own profits.
This profit is therefore wholly gratuitous because it does not
derive from the creation of anything. Group insurance is the most
expensive, the least scientific, and clumsiest way of mobilising
collective security for the individual good.

In many countries the law implicitly recognises this because
the insurance company is required to invest some, if not all, its
income in trustee stock, national bonds and debentures. In other
words, the company must invest in those properties which bear
the strongest imprint of continuous communal action. The
nearer the investment approaches to those forms of property
which are most characteristic of competitive capitalism, the
less the element of collective security, and therefore the less

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desirable from the point of view of insurance. There never can be
a clearer case of the private exploitation of a product publicly
produced.

Where medical benefits are attached to employment as a term
of the contract the situation is somewhat different. Here is an
instance where the workers, as occupational groups, succeed in
accomplishing what they have failed to do or not tried to do as
enfranchised citizens. It has the one advantage that the employer
in such a case will be less eager to Lobby against legislation for a
national health scheme. He may bo inclined to support national
proposals because these will make others share part of his burden.
As a political tactic, therefore, occupational medical benefits have
sometliing to be said for them; and the workers enjoy some
protection in the meantime whilst the national scheme is being
held up.

But they are no substitute for a national sclieme. An industrial
basis is too narrow for the wide range of medical needs which
should be met, both for the worker and for his family. The
incidence of siclaiess vary from industry to industry and so do the
rates of economic obsolescence and unemployment. We had
experience of tlris in Britain where certain of the Approved
Societies under the old National Health Insurance recruited a
disproportionate number of members from industries with a higli
degree of sickness and accident rate, and affected by serious
industrial depression. The result was that these Approved
Societies were compelled to curtail benefits to their members,
whilst other Societies with a different industrial composition were
able to distribute the full benefits. That situation consequently
helped the strong and hurt the weak.

There are two final objections to the methods I have been
describing. They create a chaos of little or big projects, all aiming
at the same end; assisting the individual in time of sickness. A
whole network of strong points emerge, each with a vested interest
in preventing a rational national scheme from being created.
Thus to the property Lobby is added the Lobby of those who
stand to lose under the national project. In the end they may

A FREE HEALTH SERVICE

79

have to be bought out at great cost in time, effort and money.

The second objection is even more serious. These schemes all
have for their aim the consumption of the apparatus of health.
But they leave the creation of that apparatus without plan and
central direction. In place of a rational relationship between all
its parts, there arises a patch-quilt of local paternalisms. My
experience has taught me that there is no worse enemy to the
intelligent planning of a national health service; especially on the
hospital side. Warm gushes of self-indulgent emotion are an
unreliable source of driving power in the field of health organisa-
tion. The benefactor tends also to become a petty tyrant, not
only willing his cash, but sending his instructions along with it.

The other alternative is a flat rate compulsory contribution for
all, covering the full range of health treatment, or a limited part
of it. There is no advantage whatever in this. It is merely a form
of poll tax with all its disagreeable features. It collects the same
from the rich and the poor, and this is manifestly unjust. On no
showing can it be called insurance.

One thing the community cannot do is insure against itself.
What it can and must do is to set aside an agreed proportion of
the national revenues for the creation and maintenance of the
service it has pledged itself to provide. This is not so much
insurance as a prudent policy of capital investment. There is a
further objection to a universal contribution, and that is its wholly
unnecessary administrative cost; unless it is proposed to have
graduated contributions for graduated benefits, and I have already
pointed out the objections to that. Why should all have contri-
bution cards if all are assumed to be insured? This merely leads
to a colossal Record Oflice, employing scores of thousands of
clerks solemnly restating in the most expensive manner what the
law will already have said; namely, that all citixens are in the
scheme.

The means of collecting the revenues for the health service are
already in the possession of most modem states, and that is the
normsd system of taxation.

Thi» wfl*' course which commended itself to me and it is the

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IN PLACE OF FEAR

basis of the finance of the British Health Service. Its revenues are
provided by the Exchequer in the same way as other forms of
public expenditure. I am afraid this is not yet fully understood.
Many people still think they pay for the National Health Service
by way of their contribution to the National Insurance Scheme.
The confusion arose because the new service sounded so much
like the old National Health Insurance, and it was launched on the
same date as the National Insurance Scheme. Some part of the
misunderstanding was caused by lire propaganda of the B.M.A.,
which warned the people at one time that, although they would
be paying their contributions, the Health Service would not be
there to meet their needs. There was a certain irony about this,
because when the time came for enrolment in the Health Service
more than ninety per cent of the population hastened to get their
names in; some under the impression, helped by the B.M.A.
itself, that they had started paying for it. This gave me some
quiet satisfaction.

One of the consequences of the universality of the British
Health Service is the free treatment of foreign visitors. This
has given rise to a great deal of criticism, most of it ill-informed
and some of it deliberately mischievous. Why should people
come to Britain and enjoy the benefits of the free Health Service
when they do not subscribe to the national revenues? So the
argument goes. No doubt a little of this objection is still based
on the confusion about contributions to which I have referred.
The fact is, of comse, that visitors to Britain subscribe to the
national revenues as soon as they start consuming certain commo-
dities, drink and tobacco for example, and entertainment. They
make no direct contribution to the cost of the Health Service
any more than does a British citizen.

However, tliere are a number of more potent reasons why it
would be unwise as well as mean to withhold the Free Service
from tlie visitor to Britain. How do we distinguish a visitor from
anybody else? Are British citizens to carry means of identification
everywhere to prove that they are not visitors? For if the sheep
are to be separated from the goats both must be classified. What

A FREE HEALTH SERVICE

81

began as an attempt to keep the Health Service for ourselves
would end by being a nuisance to everybody. Happily, this is
one of those occasions when generosity and convenience march
together.

The cost of looking after the visitor who falls ill cannot amount
to more than a negligible fraction of £399,000,000, the total cost
of the Health Service. It is not difficult to arrive at an approxi-
mate estimate. All we have to do is look up the number of visitors
to Great Britain during one year and assume they would make
the same use of the Health Service as a similar number of
Britishers. Divide the total cost of the Service by the population
and you get the answer. I had the estimate taken out and it
amounted to about £200,000 a year.

Obviously this is an over-estimate because people who go for
holidays are not likely to need a doctor’s attention as much as
others. However, there it is for what it is worth and you will see
it does not justify the fuss that has been made about it.

The whole agitation has a nasty taste. Instead of rejoicing
at the opportunity to practise a civilised principle. Conservatives
have tried to exploit the most disreputable emotions in this
among many other attempts to discredit socialised medicine.

Naturally when Britons go abroad they axe incensed because
they are not similarly treated if they need the attention of a doctor.
But that also I am convinced will come when other nations follow
our example and have Health Services of their own. When that
happens we shall be able to work out schemes of reciprocity, and
yet one more amenity will have been added to social intercourse.
In the meantime let us keep in mind that, here, example is better
than precept.

The National Health Service and the Welfare State have come
to be used as interchangeable terms, and in the mouths of some
people as terms of reproach. AVhy this is so it is not difficult to
understand, if you view everything from the angle of a strictly
individualistic Competitive Society. A free health service is pure
Socialism and as such it is opposed to the hedonism of capitalist
society. To call it something for nothing is absurd because

82 IN PLACE OF FEAR

everything has to be paid for in some way or another.

But it does mean that the Service is there to bo used at the time
you need it without payment anxieties. To put it another way,
you provide, when you are well, a service that will be available if
and when you fall ill. It is therefore an act of collective goodwill
and public enterprise and not a commodity privately bought and
sold. It takes away a whole segment of private enterprise and
transfers it to the field of public administration, where it joins
company with the preventive services and the rest of the communal
agencies, by means of which the New Society is being gradually
articulated. Nor should wo tmderestimate the size of the invasion
we are making. In Britain there are more than 340,000 workers
of various kinds engaged in the National Health Service. It costs
about eight pounds per head of the population.0 But a large
proportion ot this sum was being paid on private account before
the Service started. It is impossible to estimate the exact amount.
Some experts in this field go so far as to say they doubt whether
there is any real net additional social cost, because of the innumer-
able harpies who battened on the sick and who are slowly being
eliminated. Be that as it may, there is no doubting the magnitude
of tire enterprise. What is surprising is the smoothness of the
transfer and the way it is settling down.

The prophets of disaster have been proved false, as they so often
arc when new and ambitious ventures are projected.

And now comes the question so frequently asked: Do not all
these free facilities invite abuse? Whenever I was asked that
question I always answered: "A pre-requisite to a study of human
behaviour is that human beings should first be allowed to behave.”
When the Service started and the demands for spectacles, dental
attention and drugs rocketed upwards the pessimists said: "We
told you so. The people caimot be trusted to use the Service
prudently or intelligently. It is bad now but there is worse to
come. Abuse will crowd on abuse until the whole Scheme
collapses.”

Those first few years of the Service were anxious years for
those of us who bad the central responsibility. We were anxious,

A jjJiiiE HEALTH SERVICE

83

not because we feared the principles of the Service were unsound,
but in case they would not be given time to justify themselves.
Faith as well as works is essential in the early years of a new
enterprise.

The question uppermost in my mind at that time, was whether
a eonsistent pattern of behaviour would reveal itself among the
millions using the Service, and how long would it take for this to
emerge? Unless this happened fairly soon it would not be possible
to put in reliable estimates for the Budget. The first few Estimates
for the Health Service seemed to justify the critics. Expenditure
exceeded the Estimates by large amounts, and Mr, Churehillwith
his usual lack of restraint plunged into the attack. In this he
showed less insight than his colleagues, who watched his antics
with increasing alarm. They knew the Service was already
popular with the people. If the Service could be killed they
wouldn’t mind, but they would wish it done more stealthily and
in such a fashion that they would not appear to have the
responsibility.

Ordinary men and women were aware of what was happening.
They knew from their own experience tliat a considerable pro-
portion of the initial expenditure, especially on dentistry and
spectacles, was the result of past neglect. When the first rush was
over the demand would even out. And so it proved. Indeed it
was proved even beyond the expectations of those of us who had
most faith in the Service.

It is not generally appreciated that after only one full year’s
experience of the Service I was able to put in an Estimate which
was firm and accurate. This was remarkable. It meant that in
so short a space of time we were able to predict the pattern of
behaviour of all the many millions of people who would be using
the Service in a particular year. Whatever abuses there were they
were not on the increase. From that point on, any increased
expenditure on the Service would come from its planned expansion
and not from unpredictable use and abuse. We now knew the
extent to which Ihe people would use the existing facilities and
what it would cost us. The around was now firm under our feet.

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IN PLACE OF FEAR

Such abuses as there were could be dealt with by progressive
administrative prcssurc.(®)

Danger of abuse in the Health Service is always at the point
wJiere private commercialism impinges on the Service; where, for
example, the optician is paid for the spectacles he himself pre-
scribes, or the dentist gives an unnecessary filling for which he is
paid. Abuse occurs where an attempt is made to marry the
incompatible principles of pi-ivate acquisitiveness with a public
service. Does it therefore follow that the solution is to abandon
the field to commercialism? Of course not. The solution is to
decrease the dependence on private enterprise. The optical
service is a case in point.

I have been told by ophtlialmic surgeons that opticians prescribe
spectacles sometimes when they are not really necessary. This, of
course, the opticians hotly resent. The opticians’ protests would
carry more weight if they were not also purveyors of spectacles.
They thus make a profit out of their own advice and this tends to
cast doubt on the advice itself.

This is an obvious defect in the British Health Service as it is
now. I never intended it to remain. The present arrangements
have always been regarded as temporary, to be replaced as
follows. If the family doctor believes there may be something
wrong with your eyes the best person to advise is the ophthalmic
surgeon and not the ophthalmic optician. The latter is primarily
concerned with those physical abnormalities that lead to defects
of vision. The surgeon is interested in the physiological as well
as the anatomical aspects. Under the revised scheme the patient
would be sent to the surgeon, who would use the optician to give
a reading of the eyes and so save liis own time. Spectacles would
tlien be provided only if the surgeon thought them necessary.

Ophthalmic surgeons tell me that if this scheme were in
operation fewer spectacles would bo in use. And it would be to
the advantage of the patient to be examined by the surgeon in the
first instance, for he might find in the eyes evidence of morbidity
of wider significance, and thus assist the patient to whatever
other treatment might be necessary.

A FREE HEALTH SERVICE 85

There are other and better ways of dealing with alleged abuses
than by throwing up the sponge.

A free Health Service is a triumphant example of the superiority
of collective action and public initiative applied to a segment
of society where commercial principles are seen at their worst.

“The old system pays me better, so don’t interfere.” Who
would dare to put it so crudely? But it is as well to keep in mind
that a public undertaking of this magnitude is Big Business. It
touches trade and industry at a hundred sensitive points. A
striking illustration of this was provided by our efforts to take
proper care of the deaf. It had always seemed to me that this
affliction had received too little attention. Deafness is a grievous
handicap, worse some say even than blindness, though here we
must speak with diffidence, because no one who has not suffered
both can really judge. But this at least is agreed. Deafness
causes much personal suffering and industrial loss. The
mechanical aids to deafness were often deficient, and always too
expensive for all but a tiny section of those in need.

The way that seemed to offer the best chance of success, was to
bring the hearing specialist and the aural technicians into con-
ference with each ot W, to see if a satisfactory aid could be devised,
which could then be put into mass production and distributed
through the hospitals. The effort met with outstanding success.
By September 1951, one hundred and fifty-two thousand aids
had been distributed and the users are enthusiastic about them,(®)
They cost approximately one tenth of those on sale commercially.
There is no reason why, after the home demand has been met, they
should not prove the basis of a thriving export trade.

By bulk ordering of common essentials and cutting out unneces-
sary retail profit margins, as in the instance given, substantial
economies can be made.

It is significant that few Conservatives mention this side of the
Health Service, They are silent where economies could be made
at the expense of profits. The possibilities of bulk ordering of
whole ranges of hospital equipment and necessities such as
blankets and linen, were realised early in the development of the

86

IN PLACE OF FEAR

Scheme. In order to extend the advantages of this over a wider
field of public expenditure the Supply Department of the Ministry
of Health was made responsible for the medical needs of the
Armed Forces. When all these are fully integrated, the result
should make a significant impact on the private sector of the
industries alTcctcd. The manufacturers will be afforded a reliable
estimate of the requirements of the public authorities and can
adjust their production flows accordingly, whilst improved
specifications should improve quality and reduce cost.

But the hardest task for any public representative charged with
the duty of making a free Health Service available to the com-
munity, is overcoming the fears, real and imaginary, of the medical
profession. His task is to reconcile the general public interest
with their sectional claims. No pressure groups are more highly
organised in Britain than the professions, and among these the
medical professions are the strongest.

I was anxious to ensure that the General Practitioner should be
able to earn a reasonable living without having to aim at a
register which would be too large to admit of good doctoring.
To accomplish this I suggested a graduated system of capitation
payments which would be higlicst in the medium ranges and
lower in tire higlier. This would have discoiuaged big lists by
lessening the financial inducement. The B.M.A. refused this,
though now I am told they are ready to re-open the question.
Had they agreed at the time the position of doctors in the over-
doctored areas of the country would have been made easier aS
re-distribution over the country as a whole gradually took place.

I have a warm spot for the General Practitioner despite his
tempestuousness. There is a sound case for providing a little
more money to help the doctor with a medium list who wants to
make a decent living and yet be a good doctor. The injection of
several million pounds here would refresh the Service at its most
vulnerable point; that is, the family doctor relationship. The
family doctor is in many ways the most important person in the
Service. He comes into the most immediate and continuous
touch with the members of the community. He is also the gate-

A FREE HEALTH SERVICE

87

way to all the other branches of the Service. If more is required
than he can provide, it is he who puts the patient in touch with
the specialist services.(^)

He is also the most highly individualistic member of the medical
world. As soon as he leaves medicine he seems to think in slogans.
These are shot through with political animus of the most violent
description — ^usually Conservative. I speak here primarily of the
British Medical Association. The Medical Practitioners’ Union
on the other hand is a progressive body, affiliated to the Trades
Union Congress and more up-to-date in its views. But it was
with the B.M.A. I had to negotiate. I usually met its representa-
tives when they had come hot from a conference at which the
wildest speeches had been made, frequently by the very men who
then had to try to come to terms with the people they had been so
immoderately denouncing.

I enjoyed the challenge. My trade union experience had taught
me to distinguish between the atmosphere of the mass demonstra-
tion and the quite different mood of the negotiating table. I was
therefore able to discount a great deal of what had been said from
the rostrum. Also it was easy for me to enable them to win
victories, for they had usually worked themselves up into a fever
of protest against proposals which had never been made. Thus
they would “never be made into civil servants”.(®) As I never
intended they should, I was able to concede the point without
difficulty.

Then there must be “free choice of doctor”. I myself was
most anxious to insist on this, for I saw in it one of the most
important safeguards for the public. The right of the patient to
leave his doctor and choose another whenever he Uked, had a
double edge that the B.M.A. spokesmen did not fully appreciate
until later. Then there was the demand for full rights of free
expression of opinion, both about the Health Service and any-
thing else. To this again I was most ready to respond, as it had
never occurred to me that anything otherwise had been intended.

And so it went on from one blown out slogan to another.
Indeed, I warned the leaders of the profession that they were

IN PLACB Oi' ruAR

»&

making a fundamental mistake in strategy. They were mobilising
their forces to fight a battle that was never likely to begin. When
later I was able to make a considered statement in Parliament
giving a solemn undertaking to abide by principles that were
my own from the very start, the B.M.A. found its forces leaving
the field just when the crucial stage in the struggle was reached.

In speaking of the medical profession, I must not be thought to
be speaking at the same time of the individual men and women
who make it up. In their case, as in so many others, the psychology
of the profession as a whole is not a sum of its individual parts.
Indeed, this seems to be much more the case with doctors than
with other social groups. In my dealings with them I was soon
made aware of two curious streams of thought. In the first place
the general public has no great faith in the medical profession
considered as a collectivity, which in no way interferes with a
warm attachment between individual doctors and patients.
Statesmen anxious to establish a free Health Service should keep
that in mind. In a conflict between the profession and the general
public the latter will always win if they are courageously led. The
pretensions of the medical profession as a special social group
are resented by the generality of citizens. They savour too much
of caste and privilege. The practice of medicine is still so much
more an art than a science that its practitioners do not seem to
the laity to be justified in the atmosphere with which they are apt
to surround themselves. There is a good deal of hit and miss
about general medicine. It is a profession where exact measure-
ment is not easy and the absence of it opens the mind to endless
conjecture as to the efficacy of this or that form of treatment.

The doctors themselves insist on this element of unpredicta-
bility in the response of individual patients to various fonns of
treatment. They afiirm that individuals differ so much that there
is always a high subjective content in the practice of medicine.
This arises in a variety of ways; in the medical history of the
patient, his work, his relations with his family and with the
society of which he is a member. All these apparently have to be
taken into account in diagnosis and treatment. This we accept.

A FREE HEALTH SERVICE

89

and indeed it is fairly obvious. What is not so obvious is that the
average doctor is equipped by his general education and by
temperament to make an assessment of so many imponderables.
He requires for this delicate task imaginative sympathy, sensitivity,
and a liberal education; and these are not so widespread in the
profession as many of us would like to see. That there are such
gifted persons we know, and they are of infinite benefit to suffer-
ing mankind. But in this field with its margin of error, the quack,
the charlatan and the ill-equipped also flourish, and there are
few tests the layman can apply to safeguard himself.

In my discussions with many of the best members of the
medical professions in Britain they have Individually always been
ready to admit this with true scientific humility. But the margin
of possible error which is part of their daily experience does not
free them from what can only be described as a collective arro-
gance. This is accompanied by waves of something approaching
mass hysteria whenever proposals affecting their profession are
advanced. We saw it in Britain, we have seen it in Australia and
New 2fcaland, and now it appears to have the medical profession
of the United States in its grip.

In dealing with the medical profession it is wise to make a
distinction between three main causes of opposition to the
establishment of a free National Health Service. There is the
opposition which springs from political opinion as such. This is
part of the general opposition of Conservative ideas, and it is
strong in the medical profession, though the expression of it tends
to be supercharged with the emotions borrowed from other
fears and ambitions. Second, there is the defence of professional
status and material reward. The latter, of course, they share with
other pressure groups. Then, thirdly, there is the opposition
which springs from the fear that lay interference might affect
academic freedom and come between the doctor and his patient.
The third group is the most legitimate and will unite all the mem-
bers of the medical world, from the self-seeking to the truly
idealistic. Any health service which hopes to win the consent of
the doctors must allay these fears. The fear of State interference

90

IN PLACE OF FEAR

in academic matters is very strong in the Western world, although
it tends to ignore the power that patronage already has to
influence the pattern of medical investigation. Nevertheless,
entitlement to advancement on grounds of merit alone, free from
any tinge of political nepotism, must be jealously guarded by any
self-respecting profession. Nor should less informed opinion be
allowed to influence the medical curriculum. Here there is no
substitute for the refreslunent of renovating influences within
the profession itself. Freedom of discussion and a readiness to
add to, and receive from, the corpus of accepted knowledge, are
the only ways we have yet discovered to safeguard what we have
gained, and to open ways to new discoveries.(®) The medical
profession is cautious, some say unduly so, in accepting new
ideas. This has been impressed upon me over and over again by
those who claim to have discovered methods of treatment and
cure other than those normally practised by the profession. On
the other hand, it is my experience that xmorthodox practitioners
are often the worst quacks, and when offered a fair hearing,
unwilling to expose themselves to the disciplines of controlled
experiment and verification. As a general rule they advance
testimony in place of evidence and credibility in place of informed
conviction.

There is no alternative to self-government by the medical
profession in all matters affecting the content of its academic life,
although there is every justification in lay co-operation in the
economy in which that is carried out. The distinction between
tlie two is teal. It is for the community to provide the apparatus
of medicine for the doctor. It is for him to use it freely in accord-
ance with the standards of his profession and the requirements
of his oath.

This is also the case with respect to the relations between the
doctor and his patient. A grjeat deal of nonsense has been talked
about this. There never has been any danger that socialised
medicine would destroy the privacy of doctor-patient relation-
ship. Such a danger would indeed rupture a health sendee from
the start. The privacy rightly accorded a patient under a health

A FREE HEALTH SERVICE

91

service is much more than is often the case in, for example,
private insurance. The consulting room is inviolable and no
sensible person would have it otherwise.

The defects in the Health Service that have been brought to
li^t by practical experience lie in quite other directions. Although
it is essential to retain Parliamentary accountability for the
Service, the appointment of members of the various adminis-
trative bodies should not involve the Minister of Health. No
danger of nepotism arises, as no salaries are attached to the
appointments, but election is a better principle than selection.
No Minister can feel satisfied that he is making the right selection
over so wide a field. The difficulty of applying the principle of
election, rather than selection, arises from the fact that no electoral
constituency corresponds with the functional requirements of the
Service. This is particularly so in the case of hospital organisation.
Hospitals are grouped in such a way that most, if not all, the
different medical specialities are to be found within a given area.

A solution mi^t be found if the reorganisation of local govern-
ment is sufficiently fundamental to allow the administration of
the hospitals to be entrusted to the revised units of local govern-
ment. But no local finances should be levied, for this would once
more give rise to frontier problems, and the essential unity of the
Service would be destroyed.(')

Another defect in the Service, which was seen from the begin-
ning, is the existence of pay beds in hospitals. The reason why
this was tolerated at all, was because it was put to me by the
representatives of the Royal Colleges that in the absence of pay-
bed sections in the hospitals the specialists would resort in greater
measure to nursing homes. As the full range of medical facilities
are available only in the hospitals as a general rule, the specialists
should be there, on the spot, as much as possible. The argument
is sound, but there can be no doubt that the privilege has been
abused. Pay beds are a profitable source of income to the
specialists, and there is therefore a disposition to prefer patients
who can afford them at the expense of others on the hospital
wailing lists. The number of pay beds should be reduced until in

92

IN PLACE OF FEAR

course of time they are abolished, unless the abuse of them can
be better controlled. The number of “amenity beds” should be
increased. These are beds for which the patient pays a small
sum for privacy alone, all the other services being free. These
changes would mean a loss of revenue to the National Health
Service, but they would cut out a commercial practice whicli
undermines the principle of equality of treatment that is funda-
mental to the whole conception of tlie Scheme.

Doubtless other defects can be found and further improvements
made. What emerges, however, in the final count, is the massive
contribution the British Health Service makes to the equipment
of a civilised society. It has now become a part of the texture of
oirc national life. No political party would survive that tried
to destroy it.

Since this chapter was written, new legislation on the National
Health Service has been announced. It confirms our worst fears.
If they are carried out the proposals will mutilate the Service in
many of its most important activities. There is, however, ample
evidence that the British people are reacting sharply against them.
This sustains my contention that no Government that attempts to
destroy the Health Service can hope to command the support of
the British people. The great argument about priorities is joined
and from it a Free Health Service is bound to emerge triumphant.

CHAPTER SIX

THE INVASION OF DOUBT

It is a dangerous period in the lifetime of a nation when the con-
victions, beliefs, and values of one epoch are seen to be losing
their vitality, and those of the new have not yet won universal
acceptance. Many believe they are witnessing the decline of
human society, when all that is happening is a change from one
type of society to another. Those whose habits and possessions
are bound up with the vanishing social order are filled witlt
pessimism. A future which threatens with destruction all that
they had come to regard as fixed and eternal, that sacrilegiously
laughs at assumptions which they always believed to lie in the
foundations of life, that projects itself into the present in strange
words and even stranger thoughts; such a future does not seem
to them to be worth struggling for.

There is no fear more inhibiting than the fear of the future. Its
effect on sensitive minds is profound. It pervades all the arts.
It leads to a general disbelief in the efficacy of hinnan intelligence,
for if reason cannot offer a more pleasing prospect then it might
be that reason itself is at fault.

This mood in its most extreme form found expression in
fascism, which substituted a nostalgic irrationalism for the
buoyant, robust and optimistic, bustling activity of the nineteenth
and early twentieth centuries. The energy freed by the mechanical
achievements of the Industrial Revolution was essentially out-
flowing. The surpluses of the advanced industrial nations invaded
more and more areas of the world where economic and intellectual
passivity had reigned for long centuries; and the spirit of the West
responded to the challenge of the novel, the remote and the
unwon.

Confidence in the ascendancy of human reason was confirmed

9t

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IN PLACE OF FEAR

by daily victories, especially in the physical sciences and the
mechanical arts. It was not to be expected that the nature of the
society that was being created should be a subject of contempla-
tion, when all the time that society was pushing back its boun-
daries0 and adding to its wealth. Contemplation and the
introspective mood that is its congenial climate cannot be
expected amidst the stridency and brashness of a Revolution still
obeying the thrust of its i ni tial impulse.

Toward the end of the nineteenth century the trade unions of
Britain began to gather new strength, and in the first decade of
the twentieth century they burst into an angry roar of strikes and
lock-outs. The miners in particular gave the first few heaves of
that prolonged protest which hastened the birth of the Labour
Party and gave it many of its leaders.

In its attempt to harvest social discontents, the Liberal Party
took the first few tentative steps towards the establishment of the
social services, but these were loo timid and hesitant to be really
successful. The industrialists who were the chief backers of the
Liberal Party were not prepared to allow any substantial part of
their profits to be creamed off for welfare expenditure. It is the
fashion of those who write history in the fonn of biographies
to talk of the Liberal Party as having been destroyed by the
personal ambitions of this or that leader, or as having been under-
mined by the intrigues of factions. These no doubt played their
part. But by themselves they could never have led to the decline
of the Liberal Party if history had still had an important rfile for
it to play. The death of British Liberalism began when the
Liberal Administration of Mr. Asquith came into collision with
the dockers, the miners, and the railwaymen. Subsequent quarrels
among the Liberal leaders merely served to crack the outer shell.
The kernel had begun to wither much earlier.

In these same years the rise of Germany and Japan as serious
competitors for world markets that had long been dominated by
Britain, began to cause a few anxious frowns and some foreboding.
Self-questioning had begun. But it was a subordinate motif. It
was not the prevailing mood.

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95

In the main, Edwardian England displayed the buoyancy of
social and intellectual self-confidence at its best. Its literature, its
music, its general atmosphere, its lust for travel and exploration,
were the final flowering of the process that started way back
when the use of steam power, coal and steel gave a powerful
impetus to the accumulation of material wealth.

European society after the 1914-18 war never recaptured that
mood. The awful slaughter of the war, and the epidemics that
followed, produced a society that proved unequal to the problems
crowding in on it. The war had been in many respects a temporary
escape from economic problems that had now to be met in
aggravated forms. (*)

The Revolution in Russia posed questions for Europe that
have not yet been answered. The attack on China by Japan, and
the prolonged Civil War superimposed on external attack, posed
not dissimilar questions for all the nations entangled in the Orient.
These are being pressed with mounting urgency.

In Europe the past is dead. The future wears an ominous
visage for all who want to apply old remedies to new ailments.
It was not Socialism that killed the capitalist competitive societies
of Europe. They were killed by two World Wars and by their
failure to adapt themselves to the economic conditions brought
about by their own agencies. At the moment they are flounder-
ing, unable to make up tlieir minds which way to choose. The
assistance provided by the United States does not enable them to
recover. Rather it perpetuates a spiritual languor. National
mendicancy is no substitute for a vigorous ambition.

In Great Britain the advent of a Labour Government evoked
hopes that a solution might be found that was neither an attempt
to resurrect what history had killed, nor yet a resort to political
expedients, which had proved so grim in countries where more
severe social collisions had produced extreme reactions.

Democratic Socialism is not a middle way between capitalism
and Communism. If it were merely that, it would be doomed to
failure from the start. It caimot Uve by borrowed vitality. Its
driving power must derive from its own principles and the energy

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released by them. It is based on the conviction that free men
can use free institutions to solve the social and economic problems
of the day, if they are given a chance to do so.

No Socialist would be so foolish as to underestimate the
diflBculties that beset him. If ever he were inclined to do so the
post-war period would have taught him differently. It was clear
to the most ignorant that British industrial recovery after the war
could be accomplished only by one of those supreme efforts
which have more than once illumined our history. It was also
clear to aU but the shallow minded, that this effort could be
expected from the industrial masses only if the Government
departed from the policies which had brought about British
decline between the wars.

The country needed new men and new measures. It got both.
The result was one of the most remarkable recoveries on record.
Looking back over the period, it is now possible to see tire chief
reason for our success. It was self-confidence and the strength
that comes from it. That self-confidence was founded in the
belief that we knew what had to be done. The Labour majority
in the House of Commons after the General Election of 1945,
had obtained from the country a clear mandate to cany out
a number of measures which had been explained to the people
in the Election campaign; and by intensive propaganda stretching
over a number of decades. We were intellectually and spiritually
armed for oiu task.

It is the practice of many publicists to sneer at the Labour
Party for clinging to what are called “doctrinaire” principles.
You would imagine from the manner of these attacks that lack
of principle is a suitable political equipment. No statesman can
stand the strain of modem political life without the inner serenity
that comes from fidelity to a number of guiding convictions.
Without their steadying influence he is blown about by every
passing breeze. Nor is cleverness and political agility a substitute
for them. It has always been for me a painful spectacle when
some Labour spokesman tries to justify a piece of Socialist
legislation on exclusively “practical” grounds. There are at least

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97

two considerations to be kept in mind when making policy. Its
applicability to the immediate situation certainly; but also its
faithfulness to the general body of principles which make up your
philosophy. Without the latter, politics is merely a job like any
other.

Nor is it possible to steer a steady course unless you have a
clear vision of the destination you are making for. There are
always influences at work trying to blur issues and sap your faith.
The Labour Movement does not live in a vacuum. The defeatism
that accompanies the declme of the old social order seeps in from
every direction. There are too many Conservatives who have not
the courage to apply their conservative principles, and too many
Socialists afraid of their socialism, A nation too Jong suspended
between alternative courses of action is in a sorry plight. It is
even worse when we can discern little difference between the
parties seeking our suffrage. We are not there yet, but there is a
danger that we shall get there if recent tendencies arc not corrected.

Then there is the disposition to smooth away the edges of
policy in the hope of making it more attractive to doubtful
supporters. It is better to risk a clear and definite rejection tlian
to win uneasy followers by dexterous ambiguities.

Whenever the Labotu: Party has made a mistake, it has not been
in consequence of pursuing its principles too roughly or too far,
but by making too many concessions to conventional opinion.
An illustration of this is to be found in the nationalised industries.
We allowed ourselves to be fnghtened away from the clear
application of our policy by the clamour of the Press about the
dangers of putting avil Servants in charge of great industries.
We entrusted these industries to Boards, leaving only a power of
general direction to the Ministers. The argument went that no
Minister could possibly be responsible for all the details of
administration, and that if he tried to do so the result would be
delay in reaching decisions and endless red tape. One of the
causes of this reasoning is the folk-lore that has grown up around
private enterprise. The assumption is that the modem business
man manages all the details of his business, large or small, and

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IN PLACE OF FEAR

that the thrust of his inspired personality is felt from the board-
room to the office boy. The fact is, of course, that there is at
least as much danger of a rigid bureaucracy in private as in public
administration. Remote control is the consequence of bigness,
not of the nature of the ownership.

Tho principles of good administration are the same in all forms
of organisation. If that were not so it would be impossible to
justify tho appointment of the same men as directors of so many
and widely differing concerns. They cannot possibly be familiar
with the technical details. What they do know, or at least they
should know, are the administrative mechanisms by means of
which the businesses ate kept efficient and authority delegated to
where it belongs.

There is no fundamental difference between the National Health
Service and the railways in terms of administration. There are
more than three hundred thousand health workers for whom the
Minister of Health is responsible to Parliament. When the Health
Service was formed, and it was known that I intended to be
answerable directly to the House of Commons, I was warned that
I would be overwhelmed by questions ranging from purely
personal enquiries to wide issues of policy. The fears proved in
practice to be without justification. The right to question the
Minister of Healtli is an invaluable instrument for keeping the
Health Service vigorous and up-to-date. Most Members of
Parliament soon learned to distinguish between trivial and really
important questions.

The trouble with the Boards of the nationalised industries is
that they are a constitutional outrage. It is not proper that a
Member of Parliament should be expected to defer to a non-
elected person. The Minister, by divesting himself of parlia-
mentary responsibility, disfranchises the House of Commons;
and that means he disfranchises the electorate as well.

Part of the case for public ownership is public accountability.
This can be effectively provided only if the Minister concerned
can be questioned in the' House. The present state of affairs
reduces the Minister to the status of either a messenger or an

THE INVASION OF DOUBT 99

apologist for the Boards. This was a mistake for which I must
accept my share of responsibility.

As I Iiave said, the mistake was made by not following the
Socialist policy right through in a clean and direct fashion. One of
the more curious by-products of present arrangements is the
changed relationship between the House of Commons and the
House of Lords. It has become the practice to make the chairmen
of the Boards of nationalised industries peers. Thus you have a
gradual concentration of economic power in the House of Lords.
If a member of the House of Commons wishes to question any
part of the administration of a nationalised industry he must
write to one of their lordships, and if he is not satisfied, he cannot
raise the issue in the House of Commons.

It is wholly right that members of the House of Commons
should not occupy paid positions within the power of a Minister
to bestow. This would expose the legislature to corrupt influences.
But we do not seem to have given enough attention to the con-
stitutional implications of permitting the creation of a group of
highly paid peers responsible to no one but themselves for the
administration of vast industries. In my view this tends to raise
the status of the non-elected Chamber and to lower the status of
the House of Commons.

Political status will always follow economic power. There arc
already ominous signs that fresh attempts will be made to give
the House of Lords a more substantial place in the constitution.
The Labour victory in 1945, and the failure of the Conservatives
in 1951 to regain power by a substantial majority, are leading a
number of people to question a constitution which erects no
barriers between privilege and the popular will. "Reform of the
House of Lords” is in the air. No one doubts what it is the
reformers have in mind.

The only important political power now possessed by the
Lords is the power of delay. With the last amendment of the
Parliament Act this was further curtailed. The Lords cannot
now delay a Bill beyond one year from the date of its Second
Readine in the Commons. Labour people should watch very

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narrowly all proposals to strengthen the Second Chamber, imder
the respectable guise of “reforming” it. What is intended is a
retreat from democracy. The mood of the Conservatives is
clearly revealed by their intention to restore the University seats.
This is naked power politics; so naked that they may still hesitate
to cany out the threat. The next attack will be more subtle.

The absence of a written constitution gives British politics a
flexibility enjoyed by few nations. No courts can construe the
power of the British Parliament. It interprets its own authority,
and from it there is no appeal. This gives it a revolutionary
quality, and enables us to entertain the hope of bringing about
social transformations, without the agony and prolonged crises
experienced by less fortunate nations. The British constitution,
with its adult sufixage, exposes all rights and privileges, properties
and powers, to the popular will. The only checks are those that
arise from a sense of justice and social propriety. Thus, in the
Parliament of 1945-50, a large section of the economic apparatus
was transferred from private to public ownership on terms which
were admittedly generous; too generous, some thought. But the
transfer was made smoothly, peacefully and with political
decorum.

In human affairs two sets of forces strive for ascendancy.
There is the collective will as expressed in representative institu-
tions. There is the will of authority expressed through a variety
of other organised groups. The history of man, bloody and
tormented, has been the story of the struggle of rival authori-
tarian powers: church and king, king and nobles, dynasties
versus other dynasties, competing imperialisms.

The individuals in whom these powers were personified
arrayed themselves in the garments of tradition, and claimed for
themselves the wisdom that traditional inheritance is supposed
to confer. A dualism based on this foundation runs throughout
history: on the one hand the “wisdom of the few”, on the other
the “ignorance of the many”.

This ancient motif is being resurrected in Britain. Debates in
the House of Lords are usually described as of a very high

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101

standard: in contrast to the vulgar display of mass passion by the
elected representatives in the House of Commons. “How much
better,” it is argued, “to confer greater power on their Lordships
who can bring to bear such experience, such knowledge, such
restraint, and so much calm detachment on the issues of the
day.”

The impression sought to be conveyed is that the House of
Commons reaches decisions in the atmosphere of a lynch law trial
as compared with the cool, sober and objective attitude of the
Courts of Justice.

This picture bears not the slightest relationship to the truth.
Political discussions in the House of Lords are concentrated
expressions of group prejudice- The landlords and the industrial
magnates who form the vast majority of the House of Lords, are
no more capable of objective judgment than a crowd of licensed
victuallers trying a confirmed teetotaller. This pretence of bring-
ing together a number of neutral sages to give disinterested
political guidance to the nation on controversial issues is a fraud.
Behind it all is simply the struggle once more to enthrone the
principle of authority as a barrier against movements of mass
opinion.

It is a mistake to suppose there is no danger to democratic
practices in Great Britain. In recent discussions on the Reform
of the House of Lords, we were protected from a situation that
could have become veiy dangerous indeed, only by the Con-
servatives over-reaching themselves. We shall again have to face
this issue. As the crisis in British politics deepens, as it is bound
to do, renewed attempts will be made to find a “constitutional
solution” to questions which are plainly social and economic.
In difficult times the constitutional savant is always at hand,
beckoning us, siren fashion, to consider how much pleasanter
it would bo to cushion ourselves against popular demands than
to face hard choices.

Nor is there any more validity in the case for an elected second
Chamber. If the second Chamber shares power with the first
there is always the problem of resolving differences between the

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two. Delay is the inevitable result. Modem democracy suffers
more often from the lack of quick decisions than from limitation
of discussion. A Government can offer no more painful and
dangerous spectacle than long and protracted attempts at
solving difficulties that belong, not to the nature of the legislation
in question, but to the complications of the legislative instrument
itself.

Allocation of distinct and separate functions to each Chamber
is no solution. Lines of demarcation are not easy to define,
especially in these days when, for instance, foreign affairs are
inextricably bound up with economic questions. Tensions between
the two legislative bodies would inevitably arise as the decisions
of the one impinged on the functions of the other. In any case,
such expedients are not congenial either to the si2E of Britain
or to the political genius of the British nation. Our present
political institutions are adequate for all our purposes.

But the boards of our nationalised industries, in their present
fomi, are a new and potentially dangerous problem, both con-
stitutionally and socially. We have still to ensure that they are
taking us towards democratic Socialism, not towards the
Managerial Society.

There is a disposition in some quarters to believe that the latter
is the next stage in social evolution. That would be to surrender
to the worst feature of the Great Society — its impersonal
character. Over and over again I have laid stress on the need to
make the citizen the master of his social environment. No real
progress is made if the new order leaves him the passive creature
of a class of supposed supermen; even though these present
themselves in the guise of public servants.

In my short experience as Minister of Labour I w'as made aware
of this lamentable tendency. The statutory immunity of the
Boards of nationalised industries from direct parliamentary
control feeds this psychology. This makes it all the more necessary
that the Statutes should be revised.

The conversion of an industry to public ownership is only the
first step towards Socialism. It is an all-important step, for

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103

without it the conditions of further progress are not established.
One important consequence is a shift of power that resolves the
conflict between public and private claims. The danger of the
State machine being manipulated by private vested interests is
thus reduced. An additional result, and one of the greatest
importance, is that the nationalised industry is available as a
direct instrument of economic planning. It is no longer necessary
to rely on a complicated system of financial inducements as, for
instance, in dealing with backward textile firms: these had to be
bribed to put in modem machinery, and even so the bribes were
only partially successful. Contrast this with the development
plans of the National Coal Boardf) and of the British Electricity
Authority, and with the development of the Gas Grid. There
are other important benefits accruing to the community from
enlarging public ownership, but these fall in their proper place
in a later chapter.

The advance from State'ownership to Ml Socialism is in direct
proportion to the extent the workers in the nationalised sector
are made aware of a changed relationship between themselves
and the management. The persistence of a sense of dualism in a
publicly owned industry is evidence of an immature industrial
democracy. It means that emotionally the “management” is still
associated with the conception of alien ownership, and the
“workers” are still “hands”.

Until we make the cross-over to a spirit of co-operation, the
latent energies of democratic participation cannot be fully
released; nor shall we witness that spiritual homogeneity which
comes when the workman is united once more with the tools of
his craft, a unity which was ruptured by the rise of economic
classes. The individual citizen will still feel that society is on top
of him until he is enfranchised in the workshop as well as at the
ballot box.

Indeed, vital though it is, ballot box democracy at municipal
and national elections is limited and only partially satisfactory,
because it is occasional and remote instead of continuom and
intimate.

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It will take time to break down the antagonisms between worker
and management; time, patience and infinite ingenuity. The
psychology of belligerency is the legacy of old struggles and fears.
Which is the more productive? The discipline of fear or the
sustained energy of confidence? Conservative thinking relies
mainly on the fear of dismissal as the most effective form of
discipline in the workshop. But fear is inhibiting and wasteful,
not releasing and fertile. In so far as fear of punishment is an
effective discipline, it is appropriate only to primitive mass gang
operations under the vigilant, ever-watchful eye of the foreman.
It is less and loss effective as mental co-operation becomes as
important as simple physical effort.

Nor is the situation rendered so different when the worker is
attached to the conveyor belt and other forms of repetitive
industry. This induces only a dull resentment and a torpid
attitude in the worker unless some way is found to give him a
wider place in policy and management tW is afforded by making
him a mere automatic appendage to a machine.

The more the division of labour makes the worker a cog in the
machine the more essential it is to refresh his mind and spirit
by the utmost discussion and consultation in policy and adminis-
tration. Where this has been tried with a real will to make it
work, executive action has not been impaired. On the contrary,
the worker goes more than half-way to carry out decisions that
are the clear result of carefully explained plans. The very necessity
for allotting to the individual worker a small part in the productive
process, requires that he sees its over-all relationship to the general
scheme.

Many, though not all, managements in the nationalised
industries, approached their task with a heightened fear that the
workers would prove even less amenable to necessary disciplines
now that they were working in their own industries. This led
them to emphasise that nothing had really changed. By this
attitude they robbed themselves at the outset of the opportunity
to engage the interest and affections of the workers. It was stupid
and unimaginative. It follows, of course, from having to continue

THE INVASION OF DOUBT 105

to engage executives who were in many cases hostile to the
cliange that had been brought about.

The methods of promotion in the publicly owned industries
will have to be carefully scrutinised or we shall find the defects
of some existing managers reproduced in their appointees. A new
class of manager must be trained and he must be taught that wc
are not building a new species of pyramid. The crack of the
overseer’s whip, however disguised in its modem form, is not
how Socialists see the future of industrial relations. We have
not come thus far merely in order to slip into a new kind of
industrial helotty.

Each freedom is made safe only by adding another to it.
Democracy is protected by extending its boundaries. The
emergence of modern industry, with its danger of de-personalisa-
tion of the worker, challenges the vitality of democratic principles.
In the societies of the West, industrial democracy is the counter-
part of political freedom. Liberty and responsibility march
together. They must be joined together in the workshop as in
the legislative Assembly. Only when this is accomplished shall
we have the foundations of a buoyant and stable civilisation.

CHAPTER SEVEN

SOCIAL TENSIONS

The safety of free political institutions depends upon resolving
social tensions before these become intolerable. In a society
where the bulk of property is privately owned, public spending is
always an invasion of private rights. The product of industry is
distributed in the form of money incomes; as interest, profits,
rents, wages and salaries. The proportion of the product retained
by industrial corporations and private concerns, apart from what
is needed for replacement of wasted assets, is merely postponed
dividends.

At this stage there is no money in the possession of public
authorities, national and municipal. Private enterprise first puts
the national income in private pockets: then public spending
becomes possible only by taking back some portion of the private
income by means of rates and taxes. There is therefore an
obvious conflict between what is needed for public purposes, and
the inclination of the individual to keep as much as possible for
himself. This statement can be qualified, refined and varied
in many ways, but in the main it is a true description of what takes
place.

Many of the political tensions in individualist society come from
this source. Where the requirements of public spending are
modest, the conflict produces little political strain. But it is
otherwise when the demands of public expenditure result in claw-
ing back a significant proportion of private income.(^) At this
stage tax resistance shows itself and the temperature of political
controversy is heightened.

The strains so created are all the more intense beeause the
objects of public spending commend themselves to the conscience

106

SOCIAL TENSIONS

10/

of the majority of the nation. These include national defence as
well as the various social services that enlightened opinion has
caused the nation to adopt. The individual who is called on to
alienate a painful part of his private income to the tax collector is
not made any the more willing because it is going to finance
purposes it is not easy for him to condemn. In public he is often
ready enough to applaud the objects for which his money is
required. He becomes a sort of Jekyll and Hyde. As Jelcyll, the
good citizen, he is pleased that his country should provide
education, old age pensions, service pensions, widows’ pensions,
health services, an effective defence force and so on. But as
Hyde, the individual taxpayer, he resents paying the bill.

The political consequences of this situation vary from nation to
nation. In some continental countries it is notoriously difficult to
collect taxes justly. Certain political parties iSnd it impossible
to face the results of insisting on effective collection of taxes. In
France, in Italy, and now in the United States of America, whole-
sale evasion of taxes has become a problem for the Governments
concerned. As modem industry produces new and attractive forms
of private consumption, the individual citizen is made all the more
reluctant to see his income taken away from him for remote
purposes. It is here that an elementary selection of priorities is
seen to be at variance with the values of an acquisitive society.
Great Britain has long enjoyed the reputation of a nation where
people pay their taxes, if not enthusiastically, at least honestly.
Yet even here the tensions created by the hi^ incidence of taxa-
tion caused the Labour Party to acquiesce in a charge on the Health
Service rather than an increase in taxes. In France and Italy
not even the imperious needs of national defence have sufficed
to discipline the property owning classes into accepting a signi-
ficant reduction of their private expenditure.

The conflict between the demands of public spending and the
general class of taxpayer is further aggravated by the knowledge
that many are able to escape their just share of taxes. The income
of wage and salary earners and of most of the professional classes
is known, and the Inland Revenue takes the fidl amount the law

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IN PLACE OF PEAR

demands. But many members of the trading and business com-
munity escape proper payment by concealing their real earnings.
Prospective employees in the administrative departments of
businesses qiute commonly ask that part of their remuneration
be paid as an expense allowance, and this is not unusually granted.
Many in command of businesses are adept at the art of charging
their businesses with their private living expenses.

It is in the realm of cash trading, however, tliat the greatest
evasion of taxation occius. It is well nigh impossible for the
Inland Revenue officer to assess the amount of cash transactions
that occur between individuals. Payment by cheque is almost an
affront in certain lines of business. The spiv has entered into
modern literature not only as a by-produet of a rationing system.
He is the modem equivalent of the smuggler. He is the prototype
of the evader of taxes. All this occasions the bitterest resentment
among those citizens whose social situation forces them to pay
in full.

The consequences from a Socialist point of view of what really
amounts to a penalisation of the honest and of those whose job
does not permit evasion is exceedingly serious. The power and
prosperity of tax evaders thwarts one of the main aims of
Socialism: the establishment of just, social relationslups.

It is not my intention to write a treatise on lax evasion. J
mention it at such length because it underlines a significant shift
of values in modem society. Orthodox Socialism believed in
direct taxation. I listened to Lord Snowden on many occasions
explaining its virtues. It never seemed to occur to him that there
was a definite limit to taxation as a means of redistributmg
wealth; and as a device for financing expanding social services.
I must not be thought to hold the view that additional taxes are
not possible among certain classes. Of course they are; but they
wiU not serve to resolve the deep antagonism between public and
private spending that now holds the centre of the political stage.

Unless a radical solution is found, the political parties will
tend to revolve around the ridiculous issue of sixpence on or off
the income tax. This is purely Liberal polemics. In these cir-

SOCIAL TENSIONS

109

cumstances the social services become a political football, kicked
about from one election to another. The individual finds his
most selfish instincts mobilised against any reasonable order of
social priorities; and politics degenerate into a squalid round of
catch-penny propaganda.

No student of politics would deny that this is a real dilemma;
and it is always implicit in laissez-faire society. As I have already
said, where the property owning classes believe that the fmiction
of disposing of the economic surplus should lie with them, there
is bound to be resentment when the State steps in and takes some
of the surplus for its own purposes. This is the conflict in society
as a whole. It is a national facet of the hundred and one conflicts
between wages and profits. The struggle is for the economic
surplus, and not only for a share of the increased wealth which
follows from greater productivity. It is a demand for more
equality in the distribution of existing wealth; and for a say in
what is to happen to the increment.

When State activity expands as at present, as a consequence of
rearmament and of the extension of the social services, the share
of the natioiml income taken by the State makes a harsh impact
on individual plans and ambitions.

The perils of inflation, (“) ever threatening in conditions of full
employment where most of the economy is privately owned, add
further inflammable material to the political scene. Those whose
property appreciates in value and who are able to dispose of some
of it, or borrow on it, do so, and thus maintain their personal
expenditure. This gives an additional impulse to rising prices.
The wage and salary earners try to re-coup themselves by a
revision of their contracts with their employers, and so high
prices are pushed higher.

In the meantime, those with fixed incomes are left behind in the
race. Where these are recipients of State pensions, old age
pensioners, ex-servicemen, widows, and the like, they naturally
bring pressure to bear on their political representatives, and a
tense political situation is made tenser.

The behaviour of the political parties in these circumstances

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IN PLACE OF FEAR

corresponds to the character of the people from whom they get
most support. It is this behaviour which indicates the nature of
the class alignment in society. In times of crisis the Conservative
Party invariably attacks State expenditure on the social services
so as to relieve the burden on property. The Socialist Party, on
the other hand, rushes to the defence of Stale spending: their
supporters are the poor and defenceless who most need it. The
resulting legislation obeys these pressures, modified only by fear
of what may happen when next the Parties face the electorate.

It is manifestly unfair that those whom the community selected
for special help and protection should suffer because of rising
prices. It is not that the nation as a whole is poorer. Even if it
were, the weakest should not bear the brunt. If real property
can avail itself of ways of cancelling the effect of rising prices, why
should not those who have to seek the help of the social services
be able to obtain redress, ivithout having to resort to political
pressures that must at best succeed only after delayed action?

There seems no reason why the cost of living index, when
brought up to-date, should not be used for the purpose of re-
adjusting the scales of benefits, say at six-monthly intervals. 1
am not here discussing improvements in their standards. What is
first required is that the existing standards be defended and this
by a method which would work automatically without neces-
sitating a series of parliamentary crises. At one stroke, one cause
of political tension would be removed.

If the reply is made that the principle should work both ways,
and that the scale of benefits should be adjusted downwards with
a fall in prices, there are two answers. There is little or no
prospect of a general fall in the prices of the goods that go to
the making of the cost of living index. As far as we can see we
are in for a steady upward trend in prices. We shall be lucky if
it is steady. If, however, a fall does take place, the increased
purchasing power resulting to the beneficiaries of the social
services would be a useful means of defence against deflation and
consequent unemployment.

The same prindple should apply to national savings certifl-

SOCIAL TENSIONS

111

catcs.(®) The present practice is not fair: and it is unfair at the
expense of some of the most deserving. The vast majority of those
who buy these certificates, do so partly as an insurance against a
family financial emergency, or in order to provide little graces and
urbanities to their lives when they retire.

For the most part they are not familiar with the complexities
of the Stock Exchange and the money market. They are little
people, artists, scientists, professional and other workers, too pre-
occupied with them work to give time and attention to the world
of the money changers: or disinclined to do so. They do not
look on their savings as an investment, but as a cushion. It is
unjust that they lend to the State the savings that represent so
much sacrifice, and get back a sum which in real purchasing power
is substantially less than they lent. If the value of their savings
could be protected, they would probably be prepared to accept
a lower rate of interest: for, I repeat, it is not the income from the
savings that plays the greater part in their minds, but the savings
themselves.

The application of this principle would have the effect of easing
the inflationary pressure, for people are more inclined to buy
goods than to tie up their money in paper claims that have a
declining value.

Tlie reader will note that I have been arguing for the introduc-
tion of the principle of automatism in certain branches of our
social and political life. It is part of my general contention that
it should not be necessaiy for individuals to make so many
convulsive efforts in order to keep abreast of a changing social
environment. These make our lives too unpredictable and
tmnultuous, and exclude the hope of more serenity in man’s
relations with society.

I believe it is now necessary to apply the same principle to a
wider and even more controversial field. The workers’ attitude
to the national income as expressed throu^ their trade unions
falls roughly under two heads. First, a demand for a more just
apportionment of the total social product; second, a fair share of
the result of increased productivity. The struggle to attain both

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IN PLACE OF FEAR

of these is obscured by a third element: the effort to defend their
standard of living in a time of rising prices.

If we could once secure that real wages are not eaten into by
rises in the cost of living, the way would be clearer to a national
wages policy. Most people who have given their minds to the
problem are now convinced that a national wages policy is an
inevitable corollary of full employment, if we are not to be
engulfed by inflation. A lot of hard thinking and perhaps harder
talking will be required before we win through to something of a
permanently satisfactory nature.

The first essential is to stop the ground from slipping under
our feet. It should not be beyond our collective good sense to
apply the reformed cost of living index to the whole field of wages
and salaries. The question, as I loiow full well, is at what point
to strike the datum line. The trade union world is involved in a
continuous succession of wage negotiations. Each union is
naturally disinclined to adopt any general principle xmtil its own
particular negotiations have been finalised. Before that point is
reached, other unions have put in fresh wage claims, so at no
stage can it be said that a holding-line has been arrived at.

It is no use railing at the union leaders, for their difiiculties are
real and perplexing. Nevertheless, a now departure will have to
be made if the British economy is not to plunge from a condition
of unbalance into a fatal tail spin.

Once we can reach universal acceptance of a cost of living
index, the principle of automatism will help tranquillise the whole
of industry, and the way will be clear to tackle the next part of
the problem, which is the extent of the economic increment, if
any, and how to distribute it over the whole system in the form
of improved standards.

No one can pretend that the labour force of Britain is at present
distributed in a fashion that takes account of urgent national
priorities: and the impact of rearmament will worsen the position
beyond the imaginings of many whose complacency thrives on an
unawareness of the facts. The continued failure of the coal mines
to attract a sufficient labour force is (*) conclusive evidence of the

SOCIAL TENSIONS

lU

counter-attraction of other and much less urgent occupations.

The introduction of Italian labour into the mines is not a
solution. It is merely an escape from present headaches and ii
precursor of worse ones to come. In our crowded island no one
should pretend that a shortage of labour in a particular industry
is solved by bi'inging workers in from abroad. The problem is
one of mal-distribution of our own labour force, and this, in its
turn, is the consequence of a capital and wages policy that obeys
no long term purposive intention.

In the absence of a policy which strictly relates current adjust-
ments of personal incomes to any sinplus which may be available
for distribution, mounting paper claims will continue to produce
a series of crises both in industry and in politics until bewilder-
ment generates despair, and despair in its turn sinks into apathy.

These suggestions in no way solve the problem posed at the
beginning of this chapter. On the contrary, they serve to intensify
it. If the real value of public spending is preserved by automatic
adjustments following movements in tihe cost of living index, the
burden of taxation is the same. The money figure will be higher,
but the effect in goods and services will be the same. My purpose
is to secure that earned income along with the social services and
small savings shall not be mulcted, thus shifting the burden from
unearned income and real property. There is a real dilemma in
that the more you protect some people from inflation, the greater
the sacrifice from those who are unprotected and the faster the
rise in prices will be. We need in fact safety valves built into the
economy, and if one of them is removed (for instance, the present
vulnerability of the small rentier and pensioner), then others, for
example a cost of living index that underweighs luxuries, must be
provided. The value of this approach is that it would minimise the
political strain that follows from one class after anotherattempting
to catch up with the fall in the purchasing power of money.

I am not here deaUng with the problems arising from
trading relations between Britain and the rest of the world.
One of the results of world inflation has been to reduce imports
by makine it harder for people to buy at the higher prices.

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IN PLACE OF FEAR

This is the automatism of the price system. If men and
women were themselves automatons it might still work.
But they arc not. Long before the price mechanism is able
to effect the results expected of it, political pressures and
industrial action get to work. This has long been recognised.
The method now resorted to is direct intervention by the State to
prevent the import of less wanted goods. This is one more
example of the incompatibility of political democracy and the
price mechanism of the competitive system. If people were not
free to compel the recovery of their real incomes, the price
mechanism would bring about equilibrium after considerable
suffering by the poor. The price mechanism requires the abolition
of democratic institutions for its smooth operation.

The question I am now considering is the political one which
emerges when a high rate of public spending begins to produce
tax resistance and evasion on a wide and socially damaging scale.

No solution would be satisfactory to a Socialist which merely
produced a lower rate of taxation, for this would be at the
expense of the poorer members of the community. A fiscal
solution is therefore impossible. We must search in other
directions.

The chief cause of our difficulty lies in the fact that the whole
national product is distributed in the form of money incomes of
various kinds and then the State has to get some of it back. This
is not merely because industry is in the main in private hands, but
because private property is exceedingly badly distributed. Once
a larger proportion of industry is publicly owned, a larger part of
public spending could be financed out of the surplus which now
accrues to private owners. While it would be unfair to tax the
consumers of nationalised industries or services specially bard by
increasing the price of nationalised goods and services for this
purpose, it is equally wrong to stimulate the consumption,
sometimes the wasteful consumption, of these goods by fixing
their price below the true cost of production. For example, the
less favoured colliery areas work at a loss at a time when every
piece of coal is precious.

SOCIAL 1 ENSIGNS

115

If there are special reasons for providing goods or services,
whether nationalised or otherwise, below the cost of production,
that should be decided upon on. special grounds.

In general, the fact that an industry is nationalised should
provide additional income to the State, for, among other reasons,
compensation is paid at a low rate of interest on gilt edged
securities while the profit rate extracted in private concerns is
usually much higher. As we move away from the peiiod when
compensation is first paid, the financial advantages increase.
The surpluses from these communally owned industries would
accrue to the national exchequer and taxation could be corres-
pondingly reduced. This would not mean that taxpayers would
have more money to spend. As we have seen, this could only be
done by hurting the recipients of public benefits. But it would
mean that moie of what was distributed in the form of private
income could in the main be privately spent, and the individual
would be spared the pain of seeing so much taken from him that
he thought was his to spend.(®)

I am not suggesting the abolition of income tax. That would
only be possible if all industries belonged to the community, for
then taxation would take the form of the State share of the
industrial product. But in order to be able to reduce inequalities
in income we should institute a fiar-reaching capital levy. Until
recently, death duties were supposed to bring tMs about and to
do so with less administrative difficulty. But inequality in the
distribution of wealth has hardly decreased: death duties can be
evaded through trusts and gifts. The appreciation of capital
assets, and of the value of shares through the plonking back
of profits (which also enables the evasion of surtax) must also
be taken into account.

We have, therefore, still to devise a system that works with
maximum fairness and the least political tension. This can only
be done if the individual is not made the enemy of all decent
social activities every time the tax collector calls.

A number of invaluable social consequences would immediately
flow from the situation thus created. There would be less cheating

116

IN PLACE OF FEAR

of the Inland Revenue, for the incomes of workers in nationalised
induslries are known. Cash transactions would be confined to the
smaller private sector of industry. The possibilities of tax
evasion would be reduced in this sector, for part of the cost of
maintaining public expenditure would have been transferred to
the price of the products of the nationalised industries: and, of
course, the cost of living index would not apply to the rate of
profit.

A further consequence would be a lessening of the iufiationaiy
pressure. The property of the socialised industries could not be
sold privately or borrowed on for private spending. We all know
that much of the private spending tliat now occurs comes from
continuous capital appreciation, and from capital gains. Such
private capital as the nationalised industries required would be
in the form of fixed interest bearing stock. Whether some
protection woixld be required for it is a matter for consideration.

Then again, additional wealth created by the expansion of the
nationalised industries, could not be creamed off from time to
time as is the case in private industry when speculators take their
capital gains.

The inflationary pressure in Britain would be much more than
it is today were it not for the transfer to public ownership of coal,
gas, steel, electricity, cables and wireless. This is probably one
of the chief reasons why Britain, though hard pressed, has not
suffered the same inflation as othra comitries where the whole of
industry is open to the gambler, the money-lender and the taker
of quick gains.

The facilities given to national planning when industries are
publicly owned are obvious. Control and direction of invest-
ment is easier, and a more secure market is provided for the private
industries. These are the main consumers of the products of the
nationalised industries. Each time an attempt has to be made to
mobilise the resoiurces of the nation for some central purpose,
whether it be an export drive in particular markets or a spurt in
arming, the same planning diflSculties are experienced; private
business offers up resistance at a thousand and one points.

SOCIAL TENSIONS

11/

Controls of various kinds have to be resorted to; pivotal raw
materials carefully canalised to where they arc most required;
licences given or withheld; all requiring the employment of tens
of thousands of men and women not only to administer them but
also to see that private business does not cheat or corrupt the
State officials. The work of this army of officials is not directly
productive. It is the price we have to pay for competitive
individualism whenever we try to force it to serve some other
purpose than its own view of its interest.

If the public domain of industry was large enough to influence
the conduct of the rest, most of these direct and indirect controls
and regulations would not be needed, and the men and women
running them could be released for productive work.

If I am told that these controls over private enterprise are
only temporary, I answer that as far as Britain is concerned
State direction of our economy in one form or another has come
to stay, and it might as well stay in a respectable fashion by a
radical extension of public ownership. The Conservative Govern-
ment elected in Britain in the autumn of 1951, found themselves
faced with the necessity of imposing even more controls over
industry than they had inherited from their Labour predecessors.

I doubt whether even the United States will ever be able
completely to dismantle the system of State regulations she has
been forced to adopt for the aims programme. If she is ever
tempted to do so, she had better take a careful look round the
raw material situation(®) before giving full steam ahead to any
kind of production American business might find temporarily
attractive. The world might not be able to afford another spate
of thoughtless and wasteful production similar to that which we
have experienced during the last fifty years. If the American
economy cannot control itself, parts of the rest of the world might
have to protect its own raw matraial resources from early
exhaustion.

To steer a wholly private enterprise economy in a given direc-
tion for any considerable length of time is practically impossible.
It is alien to the laws of its being. It engenders not only the

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IN PLACE OF FEAR

tensions I have been describing but also a universal furtiveness as
individuals seek to pursue their own personal adventures in
business and finance. A British Minister of the Crown, when
asked how people were to get steel, replied “Scrounge for it.”
That mood may be tolerable for a short time. As a permanent
economic climate it is unendurable.

Thus judged from any angle, the relations between public and
private enterprise have not yet reached a condition where they
can be stabilised. That is why it is so foolish for certain Labour
men to preach “consolidation” at this stage. Before we can
dream of consolidation, tlie power relations of public and private
property must be drastically altered. The solution of the problems
I have been discussing cannot be approached until it becomes
possible to create a purposive and intelligible design for society.
That cannot be done until effective social and economic power
passes from one order of society to another.

At the moment we are between two worlds. We have lost the
propulsions of one and we have not yet gained the forward
thrust of the other. This is no place in which to halt.

That is not to say a halting place cannot be reached. I think it
can. It is clear to the serious student of modern politics that a
mixed economy is what most people of the West would prefer.
The victory of Socialism need not be universal to be decisive. I
have no patience with those Socialists, so-called, who in practice
would socialise nothing, whilst in theory they threaten the whole
of private property. They are purists and therefore barren. It
is neither prudent, nor does it accord with our conception of the
future, that all forms of private property should live under
perpetual threat. In almost all types of human society different
forms of property have lived side by side without fatal conse-
quences either for society or for one of them. But it is a requisite
of social stability that one type of property ownership should
dominate. In the society of the future it should be public property.
Private property should yield to the point where social purposes
and a decent order of priorities form an easily discernible pattern
of life. Only when this is accomplished will a tranquil and serene

SOCIAL TENSIONS 119

attitude take the place of the all-pervading restlessness that is the
normal climate of competitive society.

Where the frontier between the public and private sector should
be fixed, is a question that will be answered differently in different
nations, according to their traditions and stage of historical
development. In countries with a primitive economic develop-
ment, where revolutions have occurred, it is natural that industries
will tend to grow up in the public domain. This was the case in
Russia, and it will almost certainly be so in New China. Progress
is not a spiral. It is rather a kind of zig-zag movement as nations
are influenced in their formative period by the ideas and institu-
tions of other nations impinging upon them. It is natural that
the Orient should be influenced by the collectivist ideas of Soviet
Russia rather than by Western conceptions of progress; though
it is to be hoped that the results in the U.S.S.R. of a monolithic
and centralised collectivism will induce modifications and
variations of the collectivist philosophy, as is now the case in
Yugoslavia.

In the Western world the extension of the principles of public
ownership will be influenced by the extent to which large aggrega-
tions of private capital have coagulated into monopolies and
semi-monopolies in which profit is a clear tax on the community
and no longer a reward for risk.

So, also, the existence of producer and consumer co-operatives
may be expected to exert their influence on the character and
direction of the public domain.

15

I

CHAPTER EIGHT

WORLD LEADERSHIP

One of the difficulties of iatemational intercourse is that it is
almost impossible to express critical views about the policy of a
nation to which you do not belong, without exposing yourself
to the charge of being anti that nation. Tliis reaction is fed by a
wide assortment of newspaper leader-writers and columnists,
and, of course, by the statesmen whose politics are criticised.
Now if there is one thing I find objectionable it is generalising
about whole peoples. There are no doubt “noble” or “ignoble”,
“servile” or “courageous” individuals, but when we apply such
adjectives to nations, and groups within nations, what we are in
fact doing is describing our own emotional reactions to conduct
which meets with our approval or disapproval.

The danger of such language is its very effectiveness. It
transfers to the nation concerned, emotional connotations that
belong to the world of personal relations. From that point on
rational and objective discussion about national policies is con-
ducted in an atmosphere charged with prejudice.

I write this with no real belief that it will exempt me from mis-
representation by those whose job it is to misrepresent. All I
seek to do is to put the unbiased reader on his guard* The
intrinsic difficulties of the issues set out in this chapter are
sufficiently serious without the added encumbrance of confusing
personal and national reactions.

When the Second World War ended there was great anxiety
in Europe lest the U.S. A. should once more retire into isolationism.
I did not share this fear, for it did not seem to me to accord either
with the facts of her economic relations with the rest of the world,
with her membership of the United Nations, or with the awakened
cosmopolitanism of many of her national leaders.

WORLD LEADERSHIP

121

But on the face of it the U.S.A.’s immediate post-war conduct
gave ground for apprehension. There was her complete and
precipitate disarmament, apart from atom bomb production
and research. There was her abrupt ending of Lease Lend to
Britain, a grievous and unjust blow to the prospects of British
recovery.

Lease Lend had come to bo more than an act of national
generosity and foresight. By 1944-5 it had grown into an accepted
and planned division of the war burden. Great Britain had dis-
posed of a great part of her overseas assets, in meeting her war
expenditure, before the United States entered the conflict as an
active belligerent. Throughout the war Britain mobilised a
greater proportion of her resources for direct military action
than any other nation engaged in the war. For all practical
purposes her export trade had been sacrificed to the immediate
emergency.^) Britain was able to act in this way because of the
assumption that the needs of her population would be supplied
under Lease Lend. Thus what had begun as aid was transformed
into a division of labour. The original description remained, but
the character of the transaction had changed.

By the end of the war the economy of the United Kingdom was
inextricably interlocked with that of the United States. Cease
Fire could not change that situation at once. It is easy and most
pleasant to stop firing guns; but you carmot proceed to eat them.
The position of the United States was different. It was reasonable
to expect that a period should be allowed for the British economy
to adjust itself. This period was not vouchsafed her. The flow
of goods from the United States ceased at once, and what the
United Kingdom needed, she now had to buy, long before her
mutilated export trade could be rebuilt to meet the cost.

When the Labour Government took over in 1945 this was the
situation it had to meet. I thought then, and I still think, that the
U.S.A. at that time imposed terms that were shortsighted and
unwananted. It would be wholly wrong to describe this attitude
as British mendicancy. It is not mendicancy to expect that the
immediate consequences of a war-time alliance should be mutually

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IN PLACE OF FEAR

shared just as the burden of war itself had been shared.(®) Later
on, Marshall Aid repaired some of the damage; but in the mean-
time fears of renewed American isolationism had grown.

Nor was this fear assuaged by the speeches of many prominent
Republicans. In the result it meant that British policy was
bedevilled by the political situation in the United Stales. I know
I shall be told that this is the pri<» we have to pay for democratic
processes. I reply at once that the main theme of this book is
that concerted and sustained collective action is rendered
impossible in nations whose policies are determined by pressure
groups representing limited and often anti-social interests. If
these pressure groups were acting in a vacuum it would not
matter. But it does matter if the fate of mankind, of the United
States, as well as other nations, is decided by interests which put
their private plans and acquisitive desires before the obvious
needs of the human race. The economic triumphs of the American
system will avail the American people nothing in the absence of an
over-riding social conscience and social discipline.

When American foreign policy did concern itself witli what
was happening in the rest of the world it did so out of fear — fear
of Communism; fear of Communism in other parts of the world,
and fear of how it would impinge itself, not only on the free
institutions of the West, but also how it would affect what is
described as the American Way of Life.

Fear is a very bad adviser. Its companion is hate, and hate is
the father and mother of cruelty and intolerance. Fear of Soviet
Communism has led the United States, and those who follow her
lead, to take a distorted view of the world situation, and of the
forces which are at work in modem society. The reader who has
been good enough to follow me thus far in this book will have
gathered that I look upon free institutions as not only the most
desirable of political systems, not only as the one most congenial
to the flowering of human genius, but as indispensable in a modem
industrial community. But these institutions are threatened not
only by political dictatorships. The resistance to social and
economic change that private and sectional interests are able to

WORLD LEADERSHIP 123

offer, thus undermining the faith of the masses in their regenerating
power, can be equally deadly.

One question will serve to bring this out more clearly. Why is
it that rearmament on the present scale meets with less resistance
in the United States than it does anywhere else? One answer
will occur at once. The United States can better afford it. But
that is my case. The people of Europe love liberty just as much
as do the American people; and they axe more immediately
exposed to the peril of Soviet military aggression. If the armies
of the Soviet Block break out, the first victims will be in France,
Italy, Belgium, Holland and Western Germany: after those. Great
Britain. Why, in these circumstances, do the military advisers
of the United States place, even on civil defence, more emphasis
than do the nations of Europe; although America has greater
physical immunity ?

Or do the American Administration think they understand the
threat of Communism better than we do? Our view is that they
understand it less and, in consequence, are feeding the peril of
Communism as much as they are combating it. The United
States is very strong, but is she sure she is as wise as she is strong?
The weapons of the Soviet are in the first instance economic,
social and ideological: only secondarily military. If she relied
primarily upon military action why has she not resorted to it
before now? The atom bomb is no answer. That is a constant
factor. The Western Powers have assured the Soviet of their
present weakness and of their future strength. Why has Russia
waited for the strength of the Western Powers to grow? Influential
publicists in the United States are continually saying that they
believe a show-down is inevitable. Why should Russia wait for a
time most unfavoiuable to her? Mr. Chmchill recently stated in
the House of Commons that he asked a well-informed diplomat
when he thou^t war was most imminent and the diplomat
replied "last year”. But the rearmament of the Western Powers
is hardly under way at the moment of writing. Why has Russia
not struck? These questions reilly must be faced.

Few win suggest that the Soviet Union would not seek a local

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IN PLACE OF FEAR

military advantage. But it seems clear she would not wish to
press it to the point of general conflagration. Some irresponsible
advisers have suggested that this is a reason for us going all out
in Manchuria. But that could precipitate a third world war;
for Russia might then conclude that she bad come to the end of
the usefulness of her social and ideological weapons.

This is a time for frankness. Why do these arguments, which
are obvious, have so little effect on most of the advisers of the
American Administration, or indeed, on European Conservatives,
British included? For the simple reason that it is easier to frame
a military reply to the Soviet threat than a social and economic
one.

An effective answer to Russian aggression involves a re-
examination of our attitude to the social problems in our own
country. This may not bo so urgent in the United States, where a
buoyant economy still appears to give a rough satisfaction to
the people of that country; not in Britain where the success of
the Labour Government underpinned the democratic constitu-
tion. But it is otherwise in Fiance, Italy and certainly in those
parts of the world where hunger meets feudalism in head-on
collision.

It is indeed a grim conclusion to which we are driven. The
most valuable allies of the Soviet are those elements in society
which fight against social reforms, for these would rather risk
wax than part with wealth and privilege on any great scale. We
must face the inexorable logic of the situation. Free political
institutions do not excite people to defend them with abandon,
against the threat of another nation, if those institutions prove
inadequate to protect their well-being at home. Liberal principles
do not thrive without roots, and those roots are fed by the con-
tentment, and therefore the love, of those who see in them the
prospects of progressive amelioration.

It is because of these considerations that I believe the guidance
given to the world by the United States Administration is wrong.
They have mistaken the nature of the menace, and so they not
only prescribe the wrong remedy, but their remedy itself feeds the

WORLD UEADERSHIP

12i

danger. The scale of rearmament urged upon the democracies by
the United States is a source not of strength but of weakness.
The recent resignations of British Ministers were occasioned by
the belief that the speed and scale of rearmament demanded by
the United States, would increase world economic tensions to the
point where the Soviet diplomatic offensive would be assisted.
And so it has proved.

By the end of 1950, British recovery had reached the stage where
it could dispense with Marshall Aid eighteen months before it
was due to end. A substantial Budget surplus promised a long
awaited reward for the patient and industrious people of Britain.
The Central Reserves were sufiBcient to increase confidence in the
Sterling Area. This had been accomplished under a Socialist
Administration. At no time since the end of the 1914 war was
the British Communist Party so weak. We had proved to all,
except those too blinded by prejudice to be able to see, how
democratic institutions could be used to hold back Communism,
and solve the economic problems of the post-war world. And
all that time, be it noted, Britain had been devoting a larger
proportion of her national income to defence than the United
States.(®)

One thing I must make clear. British Socialists were not pre-
occupied with Communism. What we did was not done to
combat the fear of the Kremlin. Wo hardly gave it a thought.
We simply went about the task of applying the principles we had
been brought up to believe in, and they proved equal to the need.
We were for, not anti. I am here speaking specifically of domestic
issues.

In foreign affairs the ascendancy of the United States was all
too painfuUy clear. She had emerged from the war with her
economy stronger than when she entered it, a tribute not only to
the vigour of her industry but to her geographical position and
to the rdle she had been allotted in the allocation of war-time
tasks.

The dominating world position of the United States would have
been much easier to accept if there had been a clear idea of what

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IN PLACE OF FEAR

she wanted to do with it. Of that there was no clue; except, of
course, that she was against Communism. It was also obvious
from many of the speeches of her principal spokesmen that she
was almost as strongly opposed to British Socialism.

Here J must pay a tribute to many individual Americans
closely associated with the American Administration. They
knew what was happening in Great Britain and they admired
much of what they knew. But over and over again we were made
aware of the obstacles they met at the hands of American Big
Business. The achievements of the British Government were
consistently misrepresented. Anti-Socialist Americans listened
to their opposite numbers in Britain. Above all they listened to
Mr. Winston Churchill, unable to appreciate that his defeat in
1945 made it impossible for him to assess accurately what was
taking place. He was also handicapped by a marked illiteracy
about all things economic. During the war this had been a tower
of strength. He had only to throw the Union Jack over twenty
tanks to see them as a hundred. Fortunately the enemy also
saw them in the same light. But in peace-time, this impressionistic
arithmetic worked in reverse. Twenty tractors produced by a
Socialist Government shrank to a minus quantity. Unfortunately
the American public did not understand his subjective approach
and accepted his jeremiads on their face value. Naturally many
American business men were only loo ready to believe that British
Socialism was failing. They appear to be much more credulous
about the success of Soviet industry.

Looking back over that period, I am still astonished at the way
we were obsessed by the internal political situation in the United
States. She always seemed to be going into an election, emerging
from one, or in the throes of one. On each occasion Europe
waited with bated breath for what would happen. By now we
are accustomed to the uncertainties of the French political
system. But there is one consolation about France. Her foreign
policy is fairly consistent. It is otherwise with the United States:
or at least it appears so.

I thought we were unduly apprehensive. It seemed to me it

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would have been better for us to take our line and stick to it, and
let the United States react to us instead of us to her. I stiU think
it would have been better for both of us — and for the rest of the
world.

Up to the Korean incident American Far Eastern policy
floundered from one extreme to another. At first she put all her
money on the Chinese Nationalists. When these failed, she turned
her back on the whole area, and gave it up as a bad job. Reports
in responsible American newspapers made it clear that she would
not give her support to our remaining in Hong Kong. Our
position was simple. We are there by right of Treaty. If China
wishes to ask for a revision of the Treaty wc are ready to discuss it.
But wc would not be driven out by aggression. We reinforced our
garrison in Hong Kong despite the American attitude.

From the beginning we believed that China was not anxious
to sever all connections with the Western world. We felt that she
would not want to be wholly dependent on the Soviet Union.
Hong Kong is her bridge with us as it is ours with her.

So far we have proved right and America wrong. It is still a
matter for conjecture whether those who invaded South Korea did
not think that the United States had disinterested herself in the
Far East and that, therefore, it was safe for them to try their hand.

The United States reaction to early reverses in Korea was
sharp, and, in my view, unbalanced. She was alarmed at what
she considered the weakness of the Western Powers in relation
to the Soviet Union. To her mind there was nothing for it but
an all-out rearmament drive to make good the deficiency. To a
detached observer there was another angle. If Korea probed
American weakness, it also revealed Russian strength. Yet
Russia did nothing about it except to keep on helping North
Korea. If American reasoning was correct, this was Russia’s
opportunity. Why didn’t she take it?

Here we are back once more to the main argument. There is
no evidence to show that the Soviet Union wants a trial of
strength. She can, of course, fall into it. But it is easier for a
dictatorship to pull out of such a situation than it is for a

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democracy. A dictatorship has no public opinion to satisfy.

The reaction of the United States to the revelation of her
military unpreparedness for a major war dealt a deadly blow to
Europe’s hopes for economic recovery, and at the same time sent
a cold wind throughout the backward regions of the world. It
revealed the weakness of the motive behind President Truman’s
Fourth Point.('‘) If this motive had been entirely altruistic it
mi^t have stood the strain. I have no doubt about his intentions :
but unfortunately it had been represented to the American people
as the bulwark against the spread of Communism. Korea raised
the question, have we time for the Fourth Point to operate?
At once the military experts said no !

I have already said that this is a time for frankness. There
has never been any diffidence on the part of American public
men in saying what they think about other people. I propose to
foUow their example. It astonishes the British people to witness
the latitude given to the Chiefs of Staff of the United States to
air their views in public, not only about matters within their
technical province, but also concerning the political assumptions
behind national defence. The right of military chiefs to conduct
political propaganda is always dangerous to civilian government.
This woffid concern only the people and Government of the
United States, were it not for the fact that we are all involved in
the estimate of defence expenditure which is the direct result of
the political atmosphere created by this propaganda.

Military experts have no easier task than to advise their
government on the level of defence expenditure. AH they have
to do is to advise a larger sum than they know their govern-
ment is prepared to concede and they are quite safe. In my
experience this is invariably how they behave. If everything
turns out satisfactorily, no questions are asked by a relieved
public. If, on the other hand, disaster is encountered, the military
expert is free from blame. The real burden of anxiety falls
on the civilian Ministers who have to set the general needs
of the national economy against the clamour of the military
experts backed by a Press always ready to capitalize panic.

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129

This is precisely what we have witnessed since the eaily months
of the lifting in Kotea. The military advisers demanded, and
the Governments of the West conceded, a level of rearmament,
without paying the slightest attention to its effect on the economies
of the nations concerned. This is proved, not only by the world
infla tion now ragmg, but by the fact that only now is a serious
examination being made of the relative burdens to be borne by the
nations of the North Atlantic Treaty. We are all of us cau^t in
the maelstrom created by panic estimates.

No one is less fitted than a military expert to weigh the economic
consequences of his inordinate demands. Yet the nature of the
modem military machine makes it more than ever necessary
that the industrial repercussions should be carefully weighed,
before heavy military expenditure is embarked upon. This was
not done either in Britain or in the United States. In the latter
it was perhaps not so important, because the national economy
was not stretched by full employment as was the case in Britain.
But even in the United States little regard appears to have been
given to the effect on world prices of the uncontrolled spate of
stockpiling which followed immediately on the announcement
of the arms programme.

The arms programme, agreed in the summer of 1950, was not
sufficient to meet the needs regarded as militarily desirable. Before
the year was out a still heavier programme was demanded; and
all to be accomplished in three years, by which time, we were
told, we could “talk to Russia out of strength”. I have already
pointed out that it seems insane for Russia to wait for that date,
if her real intention is a military show-down. She is obviously
less belligerent than some American publicists.

But why three years? What gives the year 1953 so portentous
a significance? In no discussion have I heard the slightest
justification for that date. It appears to bear the same relation-
ship to scientific prediction m astrology has to astronomy. Does
it mean that by that year it is believed Russia will be prepared
and ready to move? But by that time even the more modest arms
programme of the middle of 1950 would place her in a position

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of militaiy inferiority. Or does it mean that by that time the
Western Powers will be prepared and determined to present an
ultimatum to the Soviet? If so, this is a recipe for racial suicide.
It is necessary to examine this aspect of the question still
further. It is expected that by the spring of 1953 the arms
expenditure of the United States, including foreign aid, will reach
the immense sum of sixty-five billion dollars or fifty per cent of
the Budget, and equal to eighteen per cent of the gross national
product. By that time the arms programme will be the bully of
the national economy. So fat the history of the United States
shows that it is her habit to arm for war and disarm for peace.
The question now arises, can she arm for peace? The answer
must depend to some extent on the arms burden she imposes on
herself. If it proves too grievous, she will be impatient for some
dramatic improvement in international relations. Experience
shows this rarely happens. It is juvenile to suppose that today
one feels insecure, and therefore arms, whilst tomorrow the fear
disappears and you can relax. No such black and white changes
can be expected. In such circumstances the temptation to
precipitate action is obvious. It may well be that so great are the
resources of the American economy that she can carry the arms
burden without undue strain. But this is certainly not the case
with her allies. Already, at the time of writing, France and
Britain have been compelled to lower the living standards of their
peoples, and it is hard to see how still fhrther retrenchment can
be avoided and still carry the arms programme.

The chum is now made that the United States should make a
financial contribution to enable her Allies to meet their defence
commitments. But that is to put the cart before the horse. One
of two conclusions follow. Either the programme is too high,
or the United States is not carrying her fair share of it. The
clumsiest method, and the one most hurtful to national pride, is
to make a direct contribution to help a nation finance its own
defence. This has the appearance, if not the effect, of making the
soldiers of European nations mercenaries of the State Depart-
ment. It also undermines their independence in council. It is

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131

to the interest of none of us that our spokesmen should feel
inhibited by the knowledge that their means of defence are at the
mercy of one member of the Alliance. Nor should it be forgotten
that speeches of Congressmen during Appropriation Debates
are deeply wounding to the feelings of other nations, as these
listen to their country’s defence efforts, or policies, being dis-
cussed by the representatives of another nation. American
Congressmen, Uke the rest of us, are entitled to decide how their
money shall be spent, and for what. But they should be in a
position to do so without running the risk of injuring the Alliance.

If a nation’s share of the arms programme is insupportable,
then the total should be lowered or the burden redistributed.
Any other solution is inconsistent with dignity and national
independence.

As 1 have said earlier, the duty of assessing the danger to peace,
is ultimately one for the civilian authority. It is not a matter for
soldiers. TTiey are bound to play for the widest possible margin
of safety. That is what they have done, and the result is a resound-
ing diplomatic success for the Soviet Union.

In the present unbalanced condition of the world economy, an
over-assessment of Soviet military power is as dangerous as an
under-assessment. The former risks economic ruin. The latter
invites military adventures. Soviet insistence on building up her
war machine has alarmed the world. It is my contention that
we have allowed her to alarm us into an irrational response.
Some rearmament was forced upon us. Russian peace propa-
ganda is a sham, and a cynical sham at that, as Vishinsky’s
behaviour at the United Nations Assembly in Paris revealed to
all not blinded by fanaticism. I believe Ids sinister amusement
was based on Russia’s conviction that she had frightened the
world into an arms race which will deepen economic tensions.
It is upon the results of these tensions she finally relies for success,
and only secondarily on her war machine. She knows that she
has no chance of emerging victorious from a general conflict.

Each nation is conscious of its own weakness and of its enemies*
strength. Up to a few years ago no high ranking soldier I talked

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to knew the figure of Russia’s steel production. They had not
bothered to find out. They based their defence estimates on what
they knew Russia possessed in the way of actual weapons. Since
every soldier thinks of the next war largely in terms of the last,
they made their calculations in terms of a Russian Blitzkrieg
after the fashion of Hitler’s early offensive in Western Europe.
There is no evidence to show that Russia thinks in this way, nor
would it be consistent with the nature of her economy, which is
sluggish and resistive, not mobile and offensive. It would be
expecting miracles of Russian industry if it were otherwise. A
steel production of thirty million tons per annum, only recently
achieved — ^if she has even yet done so — servicing a population of
more than two hundred millions, provides no basis for Blitz-
krieg methods of war.

Oh, I know I shall be told that she holds down the civil con-
sumption of steel, and is able to devote a far larger proportion of
it to war purposes, than is the case with other nations. Even
conceding that, the contrast with the steel production at the
disposal of the Western Powers is grotesque. The Allies dispose
of an aimual steel production of 128,000,000 tons and have a
potential output of 180,000,000 tons.CO

There is no better test of the military striking power of a nation
than its steel consumption. It represents not merely its ability
to forge the weapons of modem war, but its capacity to replace
and service them, along with the skills and know-how in the
possession of thousands of technicians and craftsmen of all kinds.
This the Russian rulers know probably better than we do, and
it is this knowledge that will restrain their military adventures
unless they are panicked into more than limited aggression.

No modem nation makes war unless she has no other way out,
or unless she thinks she has a military organisation which would
give quick victory. This Hitler thought he possessed. There is
no doubt that Russia has units organised in much the same way.
She has the spear-head; but the shaft stretches too far back to the
Urals to be wielded with swift precision.

Not only so, but such action on her part would lose her the

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133

support of those millions in Western Europe who still cherish
the delusion that Russia yearns only for peace. No matter how
the onslaught might be dressed up, and presented as defence, the
presence of Russian soldiers would bring about sharp disillusion-
ment, and consolidate the populations of the invaded countries
against her.

These considerations, among others, make the intervention
of the United States in the affairs of Europe a matter of great
delicacy. It would be fatal if European people were given the
impression that they had to choose between two streams of inter-
vention, Russian or American. This applies with even greater
force to the Middle East where an insurgent nationalism is
complicating a situation already sufficiently difficult.

An important part of the solution to these problems is to place
increasing emphasis on the r6Ie of the United Nations and less
on regional pacts, for these tend to wear the appearance of
instruments of dominant Powers. The effect of the Soviet-
dominated block within the United Nations has been to stimulate
the creation of a Western Block and this tends to reduce the
United Nations Assembly to the status of an arena in which the
Blocks manoeuvre for position.

All this arises from a fundamental failure to appreciate the
character of the present world revolution. This is taking a form
which would lead to the defeat of Soviet diplomacy if its signi-
ficance were properly grasped. Soviet expansionist aims have
already received a sharp set-back, for though uprisings of the
colonial peoples, and the revolution in the Orient, are applauded
and given limited aid, they axe at best viewed with mixed feelings.
It was not there that Soviet Russia hoped for her greatest successes.
She had reckoned on achieving these among the urban popidations
of the advanced industrial countries. Nor was this expectation
without historical foundation. The philosophy applied to
Russia after the 1914-18 war was a product of the Industrial
Revolution. It was bom in London, Berlin, Paris and New York:
not in Rostov, Kiev and Leningrad.

As I have already sought to make clear, the leaders of the

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Soviet Revolution were conditioned from the outset by the
necessity to extract surpluses from a backward agrarian popula-
tion, This led them to adopt practices that brought about a
progressive distortion of their original principles. It is this
distortion the industrial masses of the West are unwilling to
accept. Political helotry is not a condition congenial to the
psychology of an artisan population.

The history of the last thirty years would have been different
if the advanced industrial techniques of the West could have
been joined to the agrarian hinterland of Russia. But it was not
to be, and in the meantime the original impetus of the Russian
Revolution has been polluted and maimed beyond recognition.

It gives little satisfaction to the Soviet rulers to know that
contemporary revolutions are occurring in the same kind of
milieu. If you amalgamate a Russian peasant with a Chinese
peasant you don’t make a steel works. The remorseless logic
of this is apparent in Peking no less than in Moscow. Unfortu-
nately it does not seem to impress Washington in the same degree.
A wise and far-seeing statesmanship would grasp this central
fact, and make it the basis of policy. China is not the natural
ally of Russia. It is not enough, in reply, to say that the leaders
of the Chinese People’s Government were trained in Moscow
and that they use the terminology of Soviet Communism. It
would be much more astonishing if they used the language of
Colonel McCormick.

The outstanding need of China, as of similar communities, is
for the industrial products of the urban communilies of the West.
These Russia is not able to supply in anything approaching the
quantities required. Indeed, just to the extent that Russia has
perverted her own economy to war purposes, she is unable to
assist in supplying the civilian requirements of her temporary
Allies. It is a grim commentary on the direction taken by the
Russian Revolution that the North Koreans found it easier to
' obtain tanks than tractor ploughs from their Soviet “friends”.

But is not the West making just that same mistake? We have
allowed the Russian threat to divert us from the one policy that

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135

might help to pacify the world. The answer to social upheaval is
social amelioration, not bombing planes and guns; yet we are
maldng the latter on such a scale that we have no resources left
for the provision of the industrial equipment which the under-
developed areas of the world must have, if they are not to go on
bubbling and exploding for the rest of the century.

The amount set aside for Fourth Point purposes has been
reduced to derisory proportions and even then it is subordinated
to military considerations. It is a profound mistake to look
upon our relations tvith backward peoples simply as one aspect
of the struggle with the Soviet Union. If the Soviet system did
not exist, the problem would still be there.

In the United States, in Britain, and to some extent in most
European countries, the relations between industry and the
countryside are more balanced than has ever before been the case
in the history of the human race. We are well on the way to
solving the problem that brought down the civilisations of
antiquity. Urban life does not flourish against a background of
intolerable rural exploitation. Much has still to be done. The
countryside, especially the deep countryside, lacks many of the
amenities enjoyed by the urban areas. But the disparity decreases.
One further push and we can make the advantages and dis-
advantages of town versus country labour roughly comparable.
But this applies only to a small minority of the people of the world.
It is not true of India, Pakistan, Burma, Siam, China, the Middle
East and large parts of Africa, including Egypt.

If this situation made demands only on our capacity to sym-
pathise with the distress of others, its urgency would be in direct
ratio to our standards of civilised behaviour. But even the most
unimaginative amongst us should be able to see that there is more
to it than that. Our own lives are deeply involved and com-
mingled with the lives of the people living in the backward parts
of the world. The needs of our industries have brought them
into our back yard. They now bear the same relationship to the
urban communities of the West as the rural peoples of ancient
times bore to the thin urban fringe in which civilisation flourished

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for a time; and then was extinguished by the flood from the
hinterland.

The advanced industrial conununities of the West can make
little more progress, they cannot even stabilise themselves, without
sharing the achievements of their industries and sciences with the
rest of the world. Even opulent and almost self-sufficient North
America is becoming aware of this. On Monday, November 12th,
1951, the New York Times printed a leader in the course of which
it said: “. . . Obviously wo are going to become more and more
dependent upon foreign raw materials in the field of metals and
upon increasingly low quality domestic ores ... To the extent
that we are increasingly dependent upon foreign sources we are
coming to be increasingly vulnerable to interruptions in supply
consequent upon political developments or in war-time inter-
ruptions of shipping . . . Here is a set of fundamental problems
which is already bedevilling this generation and will perturb our
children and their children even more. It is to be hoped our
policy-makers realise the full gravity of those questions and are
not losing sight of them as they strive to solve the more immedi-
ately urgent short deficits impinging on our economy today.”

One obvious lesson the New York Times failed to draw from
its own analysis, is that the prudent use of scarce resources cannot
be expected from a laissez-faire economy. Private economic
adventure will continue to bum up the dwindling supplies of
precious metals with the same regardlessness for the future, as
was formerly shown by the destruction of forest lands and the
riches of the surface soils. Capitalism builds up its own capital
at the expense of the exhaustible capital existing in nature; and
calls its myopic prodigality the success of private enterprise. It
is easier to construct a conveyor belt than it is to replace the raw
materials consumed by it. Solar energy is the nearest approach
to a conveyor belt nature shows us, but we have not yet learned
to reconstruct its components into the materials for our industries,
even though we may in time harness its energy as driving power.

Fourth Point projects are therefore matters of substance and
UTEenev for all of us. It is not enouah to see the problem. It

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137

must be tackled and all its implications faced even if this involves
painful heart-searching and the dawning of wonderment as to
whether the Western Way of Life really has the permanence so
often claimed for it.

In the meantime, rearmament intensifies the problem, by
consuming ever-increasing quantities of just those materials that
are running ominously short. Wc have already been warned
by geologists and minerologists that the consumption of another
world war might well ruin us from this cause alone, apart from
all the other grim consequences.

Elsewhere in this book I discuss the need for a reputable order
of values in modem society if we are to deserve the name civilisa-
tion. It is pertinent at this point to mention one of them. If it
be the case — and it is by now, I should have thought, irrefutable —
that most, if not all, the peoples of the world are linked together
in an endless variety of reciprocal activities, then the condition
of each one of us, becomes the concern of all of us. This is only
the ethical formulation of an irrefragable fact. In these circum-
stances, we neglect, at our peril, its many implications. The
Great Societies of the West draw many of the materials for their
Way of Life from parts of the world where millions suffer actual
hunger and are ravaged by diseases which are the direct result of
malnutrition. This is not only manifestly unjust. It is also
exceedingly unsafe for us. We are witnessing some of the con-
sequences in Persia and Egypt. In the words of the New York
Times, we are dependent on the “political developments” of the
countries concerned. One of these “developments” is resentment
against appallingly bad social conditions suffered by the masses
in these lands, even as they see wealth taken from their country
to add to the wealth of people already enjoying standards of living
spectacularly hi^er than Iheh own. If these people were our
own countrymen, we should long ago have remedied their worst
distresses. Yet they are our countrymen in the sense that our
industry is interlocked with theirs.

One of the main answers of the Western Allies to this situation
is the creation of a Middle East Defence Pact. The underfed

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IN PLACE OF T-F.AR

masses yearn for material aid; we send them guns. This is the
answer of the soldier to a problem he ought not to be asked to
solve. If asked, he gives the only reply within his competence.

Once these Pacts are made, military needs require order and
stability in the countries forming them. The social and political
ambitions of the masses, in these circumstances, are seen as
opposed to our military necessities, and before we know where
we are our armed forces are enlisted on the side of the oppressors
in those countries. It is an ugly and lamentable situation, and it
all arises from trying to solve the wrong problem. The problem
is primarily social and economic, not military and strategic.

The political systems of the totalitarian nations might remain
fixed for an indefinite time, if they could prevent the intrusion of
modern industrial methods. But they are reaching out for these,
and to the extent that they adopt them, they start the same chain
of events that led to the growth of political democracy in the
West. The only political system consistent with the needs of a
modern industrial community is democracy. It is not possible to
educate workers to perform the thousand and one activities
necessary to modem industry, and still expect them to tolerate
political subservience. When you train workers to make the blue-
prints of modem industrial machines, to interpret the blue-
prints, make and work the machines, you arc digging the grave
of political dictatorship.

It is no answer to point to Nazi Germany. For ten short years
she tried to violate the laws of modem society. As a result she
produced a society barbarous, perverted, and bloody, and it
ended in a collapse as complete as any in history. Hitler could
make his dictatorship of a technically highly-trained people near
tolerable, only by a social extroversion so monstrous that it
produced a national psychology of a morbidity that still fascinates
students of social psychology.

It takes time for industrialisation to influence the political
aspirations of a people, and it takes longer in some countries than
in others. Where democracy has never existed it takes a long time
for the ferment to work. In the Soviet Union, for instance, it

WORLD LEADERSHIP

!39

must be accepted that the vast mass of workers are conscious of
emancipation and not of slavery. When the Soviet worker of
today compares his lot with that ofhis parents, he is aware of
enlargement, and not of constriction. He is now literate. They
could neither read nor write. Many occupations are open to
him where they were confined to the narrow frontiers of the
village, and the repetitious cycle of a primitive agriculture. For
him the barriers are down. He can become a mechanic, a teacher,
a doctor, an artist, a professor, or a foreman or manager in a
large industrial undertaking. It is completely unhistorical to
expect him to take any other view than that Soviet society has
lifted him to higher levels of opportunity and culture. The
picture of the Russian worker held down by a ruthless dictator-
ship is false. He is indoctrinated by a consistent propaganda
which tells him that the workers of the capitalist world are
infinitely worse oflF than he is, and the lack of commumcation
with the rest of the world fosters this delusion. But his support
of the Soviet regime does not rest even partly on this. It rests
on his own knowledge that all around him the framework of a
modem industrial community is being built, that he is helping
to build it, and that in the meantime his life is substantially, if
slowly, improving.

T his is not an apologia for the Soviet regime. We all know
there are features of the Soviet system which are repulsive. The
existence of huge forced labour camps, the ruthless punishment
meted out to political offenders, the disappearance without trace
of people who offend against the ruling clique, the appal^g
doctrine of “associative crime”; all these are deeply offensive.
But I should say only an insignificant minority of the Russian
people are aware of them. In that vast country, and among a
population of more than two hundred million, many things can
occur unknown to most of the people. It is astonishing how
many Germans were unaware of the monstrosities committed
by the Nazis. The apparatus of a modem dictatorship is
terrible, not only in what it does, but in its ability to do it
clandestinely.

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IN PLACE or FEAR

It is necessary that we keep all these things in their proper
historical perspective if we arc to avoid a black and white view
of the world. Mankind is not bom with an insatiable appetite for
political liberty. This is the coping stone on the structure of
progress, not its base. If political liberty and the institutions
which enshrine it were the spontaneous imperatives of the human
spirit, our task would be much easier. But they are earth-boimd
and time bound. The pulse of progress beats differently for
different parts of the world, and if we are to understand what is
happening around us and act intelligently about it, we must
recognise that fact and realise that once we stood where they now
stand.

And it is just because we have passed that way ourselves that
we should be optimistic about the future. Industrialisation is
lifting increasing numbers of Russians to technical and economic
importance in the Soviet economy. Their economic enfranchise-
ment is proceeding. Political enfranchisement must follow.
Economic importance combined with political nullity cannot last.
They never have yet, and there is no reason to suppose the Soviet
system will be any different. The desperate attempts made by
the Soviet rulers to insulate themselves from the rest of the world
is proof of this. It is not merely that they want to conceal from
Russians the higher standards of living elsewhere. That is true,
but there is more to it than that. They don’t want their technicians
and their professional and managerial classes to become too
familiar with the higher political status enjoyed by their opposite
numbers in other countries. Political freedom and the social
status that goes with it is a heady wine once sipped. The contro-
versies which raged recently in Soviet academic and artistic cirdcs
show how fertile the social soil is becoming. It is the top-
most branches of the tree that first reveal the rising breeze.

There is evidence also that the Soviet Government wishes to
disengage itself from Eastern Germany. In going so far West
the Soviet Union pushed itself beyond its sociological frontiers.
Its monolithic system of government and administration are
proving ill-adapted to digest the more variegated texture of

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141

Western life. It is not as easy to force centralism upon adminis-
trators accustomed to administrative initiative as upon those who
have known nothing else.

Poland, Czechoslovakia, Hungary and Eastern Germany are
not only satellites. They are also fringe States where the over-
simplified edicts of Soviet centralist policy cause endless irritation.
There is little hope that the satellites will break away from Soviet
domination. They are too tightly held for that. The peril to
Soviet authority is more subtle. The complicated industrial
system of the satellite states and the commerce attending upon
it impose local responsibilities which have to be undertaken by
individuals who stand or fall by the decisions they take. The
independence of mind resulting from that situation provokes
countless points of resistance, and each point is a focus of dis-
satisfaction.

For the present, it would be unreasonable to expect any overt
expression of discontent in the masses of the Soviet Union. The
individual Soviet citizen does not wish to break down his social
framework, because it stiU affords him scope for the extension of
his personality. Until his wants have grown to the point where he
is conscious of constriction he will not protest.

What form that protest \vill take when it comes it is dfficult to
conjecture. The machinery of oppression in a modem dictator-
ship is powerful and imiversal. The whole history of mankind
contains no parallel. So dependent is the modem large-scale
community on communication, that any group within it, when
denied its use, is paralysed. Its individual members are atomised.
They know only one collectivity and that is the one permitted by
the regime. There is therefore no spontaneous generation of an
alternative to the existing government. So far man has invented
only three methods of transmitting political power from one
generation to another; dynastic, caste and property. Not one of
the three exists among the modem dictatorships. There are some
who say they discern the beginnings of caste in the one Party
system, but this I doubt. This was possible in a comparatively
primitive community where most of the important functions of

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group life could be discharged by relatively few persons. This is
not the case in an industrialised country. There, power is
ultimately shared with those whose economic co-operation must
be ensured. These eventually comprise all the workers, for the
creation, maintenance and expansion of modem industrial
techniques depend upon a literate and trained popidation.

This is a problem the Soviet States have not yet faced. A suc-
cession of purges takes the place of replacement by free elections.
The principle of authority has replaced the authority of principle
which inspired the Revolution in the first instance. Government
by authority dominated the history of man until the universal
franchise and representative institutions established themselves
in the Western World in the late nineteenth and early twentieth
centuries.

In the meantime our job is to find a positive way of lightening
economic pressiues and easing world tensions. These ai'e worsened
and not helped by the scale and pace of rearmament and by
Regional Pacts aimed at containment and the status quo. It is
as though we expect the world to be stationary whilst we engage
in complicated strategical manoeuvres. The essence of genius, it
has been said, is to aJign oneself with the inevitable. This is as
true today as it was when emergent America rejected the ridiculous
pretensions of George the Third.

Revolutions are now taking place in nations which have lain
dormant for thousands of years. Our task is to accommodate
them within a general pattern of world co-operation. World
leadership must take account of world movements or it condemns
itself to futility. For a long time to come we shall be living in
an apprehensive and unsafe world, so the means of collective
discipline must be available. But that must not be allowed to
deflect us from a purposive and sustained attack on the long term
causes of disturbance.

Judged from this attitude, the refusal to admit the New China
into the United Nations and the continued recognition of the
Chiang Kai-Shek regime is peevish and unrealistic. It may be
hard for the moment to do the former, whilst Chinese troops are

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143

kiUing the soldiers of the United Nations, but it is better to have
China unrepresented in the meantime than to have its place filled
by people who represent nothing but a rump; and whose very
presence threatens the Chinese people with a renewal of the Civil
War from which they have suffered for so many years.

With the defeat of aggression in Korea and the consequent
assertion of the authority of the United Nations, the time will
come for a reconsideration of the status of Formosa. It is
impossible to justify a refusal to cede it to China. Its eventual
assimilation in the Chinese People’s Republic is an essential
condition for the pacification of the Far East.

The signing of the Japanese Peace Treaty, without the signature
and agreement of the real Govenunent of China, was an extra-
ordinarily flat-footed piece of diplomacy. It is diflBcult to see
what long-term policy lay behind it, unless it is one that certainly
would not commend itself to European opinion. TMs is not world
leadership. It is just querulousness, where it is not worse.

Against the backgrormd of mounting tension created by such
policies, it is idle to talk of general disarmament. People are
not, and never have been, prepared to throw their guns away while
they feel unsafe. The guns are there because the sense of
insecurity is there, not the insecurity because the guns are there.
The existence of huge armaments directly contributes to the
univ ersal fear, but it is secondary, not primary. This applies as
much to atom weapons as to more primitive types. Over-
armament can multiply the tensions, economic and otherwise, as
I have argued, but disarmament as a dehberate act must follow
from a belief that co-operation in common tasks is possible; and
from that co-operation a general pacification will ensue, and
this in its turn permit of agreement about arms.

Judged from this angle interminable discussions at the United
Nations about this or that disarmament proposal take on the
appearance of cynical manoeuvres calculated not to solve the
problem, but merely to shift blame for the resultant deadlock
from one side to the other.

Nor it- it wise to concentrate all the time on the immediate

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causes of tension. All that tliis produces is an eager desire on
the part of each contestant to think up as many differences as
possible against the others. It certainly produces polemics. But
it does not promote peace.

We shoidd try to avoid now causes of tension, such as the
rearming of Western Germany. But it is reasonable to expect the
old causes of tension to relax only after an experience of common
endeavour.

At this stage it is not possible to put forward some novel
proposal that will command immediate and universal com-
mendation. The field of international relations has been too well
explored, and by too many ingenious minds, to expect some
inspired flash of illumination to light up the way ahead for us.
We shall reach the destination we all seek, at the end of a number
of prosaic endeavours, patiently pmsued, and accompanied by
setbacks and bitter disappointments.

Whatever we decide upon must command the resources of
idealism, if we are to surmoimt the fears and limited ambitions
in which international relations are now snarled. Nothing nearer
than a distant horizon will beckon us from where we are now
bogged. The instrument for the task cannot be one nation, nor a
limited combination of nations. It must be the Assembly of the
United Nations itself. Otherwise we shall start off in a climate
of mutual suspicion.

Nor is our goal the defeat of Communism, or of Socialism, or
the preservation of this or that way of life. It is not even the
conquest of poverty, for that term is capable of so many difierent
and contradictory definitions. It is more limited than that. It
is the defeat of hunger in the most literal physical sense. Until
hunger has been left behind as a racial memory, it will not be
possible to say that man has won the decisive victory in his long
struggle with his physical environment. If hunger continues to
be the lot of millions of our fellow creatures, our civilisation will
not be safe from the fate that overwhelmed previous civilisations.

Here we approach the core of one of our main fears. Will it
one day be found possible to halt the arms programme and begin

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145

to divert economic resources to Fourth Point ends? This is a
question addressed primarily to the United States of America,
as it is principally from her that substantial wealth can be made
available for world Mutual Aid. It will be a profound test of
American statesmanship.

If she remains convinced that the chief danger to peace is the
military aggressiveness of the Soviet Bloc, then elements in the
American nation will want a show-down with the Russians, and
the danger of war will be immediately upon us. Negotiation by
ultimata is the shortest road to war. In such an atmosphere,
economic and financial pressures can be relied upon to worsen
the diplomatic situation ; for so much wealth is tied up in the war
machine, that fears of universal deflation and consequent bank-
ruptcies and unemployment, will thrust us either into military
action or the continuation of arms production on a self-defeating
scale.

The North American political system has not yet reached the
point whore it can digest its economic surpluses within its own
economy. One American commentator, Mr. James Warburg
(Victory Without War, p. 48), has described this surplus as six
to seven billion dollars of "hot money” — "money which must be
got rid of in one way or another if our economy is not to go into
a tail-spin. At present we are getting rid of our ‘hot money’
through rearmament. Without rearmament, we shall have to
increase both our imports and our foreign investments. We
cannot increase our imports — even with a sensible tarifiF— by
more than perhaps two billion dollars, unless we continue stock-
piling strategic materials. We must, therefore, plan as a normal
peace-time procedure, the annual investment of four or five
billion dollars abroad. Some of this will be private investment;
eventually most of it should be private investment, once the world
gets on an even keel. For the immediate future, we must contem-
plate public investment abroad on a large scale immediately our
military expenditures are reduced. Our economy is unhealthy,
primarily because we have never really adjusted it to our position
as the world’s largest creditor nation.”

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Mr, Warburg calls for action of the kind described on the
morrow of peace. I take the view that such action is the condition
of peace. A curtailment of the arms programme is essential to the
release of wealth for Fourth Point purposes. The prime question
is, will America ever feel safe enough to embark on such a
progrrimme in a period of international tension?

What is now required is that a reduction of arms expenditure
should not be seen as the precursor of an industrial crisis.
Otherwise fear of the effect of the industrial surplus will feed
belligerency.

Long before the arms pro^amme reaches its peak, realistic
international discussions should take place for the substitution of
an ambitious plan of world development to replace a substantial
proportion of the expenditure on arms. This would give industry
some protection against the dangers of a sharp deflation. The
Soviet Union should be invited to take part in these discussions as a
potential contributor. Since she spends so much of her resources
on weapons of war, she too should be able to set something aside
for help to backward areas; and the fact that the Western Powers
were ready to take those steps ought to go far to convince her
that no aggressive military action is intended against her.

There will no doubt be many who can see no hope of success
for any such project. Let me try to encourage them by an
illustration from recent history.

When the Labour Government took office in Britain in 1945,
relations between India and Britain had degenerated to the point
where they looked hopeless. It was useless for Britain to promise
India eventual self-government. So many promises had been
made that it had not been convenient to keep, that Indian
opinion had moved from distrust to open hostility. The resources
of statesmanship were apparently exhausted. Every attempt at
negotiation by Britain looked to India as merely a device to post-
pone Indian sovereignty. Distrust frustrated negotiation and
negotiation was unable to remove distrust.

And then the Labour Cabinet had an inspiration. Like all
great dedsions it was in essence simple. It consisted in fixing

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147

a definite date for the ending of British power in India and
Pakistan. The date determined upon was far enough away to give
time for discussions about the conditions of transfer. It was near
enough to dissolve any doubt as to the sincerity of British
intentions. At once a catalytic element was introduced into
Anglo-Indian relations to which all else had to react. The day
of liberation became a goal, a challenge, and an aspiration.
Hostility melted away, and now warm friendship has taken the
place of the accumulated bitterness of centuries.

The problem for mankind is how to get world opinion focused
on something which is not the present hopeless contemplation
of the drift to war. Is it possible to find here also a catalyst which
will rivet the attention of the world on constructive tasks and
optimistic ends? The generals have given us the dates of despair
— 1952-3. Suppose we fix a date — towards which we should at
once begin to work— when a definite percentage of what we. are
now spending on arms shall be set aside for the peaceful develop-
ment of backward parts of the world. There are three essentials
for success. The date should be far enough away for preparations
to be made. It should be near enough to excite hope and
encourage restraint. And the percentage of the arms programme
proposed to be diverted to peaceful purposes should be definite,
substantial, and capable of being expressed in terms of men and
machinery.

If this were done, the extent of our movement amy from the
catastrophe towards which we are now heading, could be measured
in the increasing proportion of our resources diverted from war
expenditure to peaceful development. Should the Soviet Union
find it possible to co-operate, it would help partly to solve the
vexed question of inspection that has proved such a stumbling
block to disarmament. A contribution from the Russians to the
peace plan would at once begin to restrict Soviet consumption
on arms. It may be argued that she could accomplish this by
reducing civil consumption. But we shall get nowhere by endless
suspicion.

There is nothincr complicated about this proposal. It should

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prove easier to work out in detail than some of the military plans
now dominating the attention of statesmen. It would guarantee
the absorption of economic surpluses where these threaten the
livelihood of millions of workpeople. It would mobilise the
energies and idealism of men and women everywhere. Optimism
and buoyancy would begin to take the place of leaden despair.
Positive and constructive effort of this kind, with its resulting
co-operation, would be worth scores of conferences on dis-
armament.

CHAPTER NINE

RAW MATERIALS, SCARCITIES
AND PRIORITIES
«

In earlier chapters I have frequently referred to the absence of any
ordered system of priorities in what I have called, using the
language of Graham Wallas, the Great Society, By priorities I
mean the recognition by the community of &st claims on its
resources, which implies the acceptance of a hierarchy of moral
values, not only in the governance of our private conduct but in
that of the State as a whole.

Of course there are the traditional priorities, such as the
judiciary, national defence and the police force; and as the Great
Society expanded and became more complex, certain primitive
disciplines were reluctantly accepted in &e interests of public
health and education, and in response to the repugnance evoked
by the grosser consequences of neglect and personal ill-fortune.
All these mitigated, even if they did not entirely remove, the
results of stripping the communal authority of almost all but the
most rudimentary functions and leaving the individual to fend
for himself.

During the last fifty years or so aU kinds of institutions and
organisations have arisen to protect the individual against the
rigours of unrestricted competition. The trade unions are a
typical example of this. At first they were fiercely resisted and
regarded as a prime offence against the gods of economic indivi-
dualism.

Professional organisations also came into existence, though
these often had a double intention, one to protect the interests of
the members and the other to guarantee to the community
standards of professional performance. Each new arrival modified
the gaunt austerity of laissez-faire prindples. Thus the citizen

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in the modem industrial society finds himself involved in a com-
plex variety of involuntary obligations. Most of these are attempts
to win some measure of control over a social environment in which
tlie individual found himself exposed to intolerable imcertainties
and privations.

Just as society itself is a means of waging the struggle for
survival in physical nature, so these various fomis of collective
action are mechanisms evolved to enable the individual to struggle
successfully with his social enviromnent. Neither in nature nor in
society are we prepared to abandon the attempt at environ-
mental control.

This is part of the answer to those who continue to swear by
the virtues of private enterprise and universal competition. When
We are told that these correspond with the basic impulses of
“human nature” We reply that the facts of human behaviour con-
tradict tliis contention at every turn. Human nature is as much
co-operative as it is competitive. Indeed the complicated texture
of modern society emphasises over and over again the greater
survival value of collective action.

Thus the grand priority that subordinated almost everything to
individual success has come to be insensibly qualified by our
obligations to the associations of which we are members, occupa-
tional and otherwise. But in spite of all this, “ofiicial” thinking
still persists in regarding the principles of economic indivi-
dualism as characteristic of modem man in modern society. This
attitude prevents us from facing the most important task of our
generation, that is, making an evaluation of where we have reached
and where we want to go from there: in short, working out a
system of social priorities.

The climate of opinion in capitalist society is wholly opposed to
this exercise. Nor should this occasion surprise. It is one of the
tragedies of history that the application of social purposes or
priorities, or whatever you like to call them, first occurred in
economically backward countries. It has therefore been accom-
panied by excesses that have produced a revulsion against further
experiments in the same direction. But this will not do. No

RAW MATERIALS, SCARCITIES AND PRIORITIES 151

amount of clamour against “Statism”, no refusal to assess the
historical significance of Soviet Communism in the modem world,
and of the different kinds of communism confused with it, nor yet
the lumping together of all forms of purposeful political endeavour
as an attempt to achieve the “Police State”, can serve to conceal
the central fact of our day. Th^ is that a number of central aims
must be worked out as guiding principles for our social and
political activities, and to these all else must be related.

I do not attempt to belittle either the difficulty or the magnitude
of the task. Free men using free institutions have never tried this
before in the long history of mankind. But that should not frighten
us. History is never a guide to contemporary action. And this for
the very good and simple reason that the panorama of the cen-
turies is not the unfolding of repetitious events. Each social
circumstance is new not only in itself but in our disposition
towards it. We must not allow ourselves to be deterred from the
effort to introduce rational principles into social relations simply
because it has never been done before; tradition, habit and
authority having been made to suffice.

It is no accident that interest in the social sciences is a com-
paratively recent phenomenon. The coming into existence of the
vast social aggregations of the modem world, thrown as they are
into a continual ferment by the discoveries of the physical
sciences, challenge the modem intellect just as the discovery of
the New World excited the curiosity of our immediate forebears.
Nor will the effort to organise society in accordance with rational
principles be prevented by witch hunts and by the political pro-
scriptions which disgrace the name of some countries at the present
time.

It is true that intelligent collective conduct can be postponed
by such behaviour, but what social advantage is there in that?
The problem is simply made more difficult. Children are taught
in our schools to respect Bruno and Galileo and other martyrs
of science, and at the same time they are encouraged to close
their minds against those who question the assumptions tmder-
lying contemporary society. Revolution is almost always reform
If I-

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postponed too long. A civilised society is one that can assimilate
radical reforms whilst maintaining its essential stability. The real
enemies of society arc those who use popular slogans to deflect
the attention of the masses from an objective study of the social
and political issues of the day. That so many people suffer from
preventable privation, whilst others enjoy privileges and material
advantages that do not on any reasonable reckoning flow from
personal accomplishments, is evidence of dangerous social
instability. In modem conditions the acceptance of central social
purposes has become a condition of man’s survival : social morality
and further progress are inextricably bound up, one with the
other.

Nothing illustrates this more clearly than the contemporaiy
attitude to mass unemployment. It is not necessary here to dwell
on the consequences of unemployment for the unemployed them-
selves. These are well known and have been exhaustively
expounded- But what have not been examined sufiBcienlly are the
implications of the determination to prevent unemployment from
occurring. Some economists insist that the absence of a pool of
idle labour means that it may not be possible to find labour for
vital jobs. From this they proceed to argue that full employment
has its corollary in the direction of labour. In short, that the
attainment of the social aim of full employment implies industrial
conscription. It is one of the curious features of the psychology
of these gentlemen that they invariably contend that any general
social good must always be at the expense of tlie Working classes.
But that is not the issue I wish to discuss here. What is more
important is the consequence of making the pursuit of full
employment a general social aim.

In a previous chapter it was pointed out that the maintenance of
full employment always carries with it the thi'eat of inflation, and
that to avoid inflation there must be sustained control by the State
of the investment programme. But even more than that is required.
If all the factors of production, including labour, are in full use
and something additional is required, that can be provided only
at the expense of some already existing article of consumption.

RAW MATERIALS, SCARCITIES AND PRIORITIES 153

(I am assixniing here no increase in productivity.) That means
selection between different forms of consumption and that, in its
turn, means arranging consumption in an order of priority. Once
this is accepted, bang goes at once a whole series of fetishes of the
competitive society. Consumer choice, for example, is no longer
king of the market, nor is our old friend the so-called law of
supply and demand, nor is the rate of profit any longer the sole
arbiter of the employment of capital. Once the Competitive
Society is compelled to serve a general social aim the automatism
of the market is interfered with at every point and we are no
longer in the capitalist system at all. We shall have abandoned
selection by competition for selection by deliberation. From this
point on, moral considerations take precedence over economic
motives; and this because the choice between the worthwhileness of
different forms of consumption implies an order of values. The
decision what to do without, or take less of, necessarily places that
particular item of consumption lowest in the order of priority.

This can best be seen at the present time in the impact of rearma-
ment on the Western World. It has been accepted, rightly or
wrongly — for the purpose of the argument it is no matter which —
that our economic effort shall be subordinate to a general aim,
the making of arms. In an economy already at full stretch this
means the displacement of other kinds of production and there-
fore of consumption. What these shall be is now the issue of
politics in the Western World. It is no longer decided only in the
market place, in the financial houses, and by the price mechanism.
No one questions the price of a tank. That is looked upon
apparently as a general good; but a public Health Service is not—
at least many do not think so.

In the case of defence requirements, fear of failure invokes the
necessary social disciplines m the economic system, although
even here the pursuit of profit frequently runs counter to the
general will.

It must now be accepted by all thoughtful citizens that the
social and economic consequence of the reannament programme
is only a special instance of a ^neral case. If fhll employment is

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accepted as an aiin to be ensiied, and not only given lip service to,
then We have left the automatism of the competitive capitalist
system behind us, and deliberate selection and choice at the
communal level must take its place. A pool of unemployment is
the necessary accompaniment of selection by the price mechanism.
It is the shock absorber of the capitalist system. The pool
decreases or increases in obedience to the ebb and flow of
economic activity, and the unemployed are crucified on the cross
of the competitive price mecham'sm. Security of employment and
the competitive society are a contradiction in terms. To promise
full employment is to promise the transition from the capitalist
system to one where we choose consciously to order the pattern
of production and consumption; and the principles we employ
in the doing of this must commend themselves to the wishes of a
free electorate.

This dilemma has been recognised by many who are loath to
accept its logic and therefore suggest an ingenious solution: what
they call “frictional unemployment”. By this is meant just enougli
unemployment to cause a pinch but not enough to make a wound.
This, so they assert, would make the economic system flexible
without running the risk of deflation and therefore large-scale
unemployment and trade depression. Also, it would not be
necessary to interfere with production in any direct fashion. It
could be done by financial control, that is, by expanding and
contracting credit facilities.

This is a solution highly attractive to certain types of mind
that prefer ingenuity to the more painful process of deciding on
first principles. If we descend from the lofty heights where
abstractions reign and think in terms of concrete realities, what
this device means is that decisions on what are to be production
priorities are to be decided by bankers. Such a state of affairs
Would be wholly inconsistent with democracy. It would soon lead
to trouble on a large scale.

In the absence of clear directives bankers have no way of
deciding to whom to lend money except by the test of credit-
worthiness. This means the possibility of a profit. The greater

RAW MATERIALS, SCARCITIES AND PRIORITIES 155

the prospect of a profit the more credit-worthy. So we are back
where we started. But there are always prospects of profits on a
rising market. Mere prospects of profit-making as the basis of
lending would consequently lead directly to inflation. It would
not be the substitution of one kind of consumption for another.
It would mean an attempt to achieve all kinds of consumption
simultaneously with no consideration of priority except the cash
nexus. This has already been recognised in Britain where the
banking houses have received directives from the Treasury to
guide them in the issuing of credit. Armament is the test. When
this is over the test will be full employment without inflation.
That is to say, if promises are kept. So in neither case will it be
possible to dodge the obligation of determining economic
priorities. This is inescapable wherever some over-riding principle
is at work other than the rate of profit.

Controlled unemployment as a substitute for purposeful inter-
ference witli the automatism of the price mechanism is conse-
quently no substitute at all. As controls will be necessary in both
cases, controlled plenty would seem to be more reasonable than
controlled misery.

Of course, there is no exact comparison between the aim of full
employment and the aim of arms production. In the latter case,
what is intended is a certain type of production-arms. In the
former, merely full production without regard to what is produced.
One is quantitative, the other qualitative. But what we started to
inquire into is just what is to give way in conditions of full
employment if some forms of production are required as against
others.

It was this situation that faced the British Labour Government
during the whole of its period of office. And the present Con-
servative Administration has also to face it. If there is no economic
slack to be taken up then preferences have to be made and much
heart burning is the result. Thus Labour had to insist that homes
for workers should take precedence over cinemas, hotels and
luxury building, and that industries producing for the export
market alone with investment in basic industries that had been

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neglected when the profit motive alone counted, should become
top priorities. There is no escape from the dilemma that if full
employment is considered a social good, then qualitative selection
among different claimants for credit facilities is inevitable.

It is here wc begin to see what is behind the device of con-
trolled unemployment. It is an effort to get away from the painful
task of deciding what is the most desirable kind of consumption
pattern to aim at. For those who swear by quantitative controls,
pure and simple, a certain margin of unemployment is a desirable
end. It may present another land of picture to the unemployed
themselves, but so long as they are not sufficiently numerous to be
an electoral liability the political consequences of their protests
can be ignored.

As I write, the London Times of January 16th, 1952, reports
an almost perfect example of the defence of an investment policy
which relies exclusively on priTOte initiative regardless of social
objectives. It is contained in the speech of Mr. Anthony William
Tuke, Chairman of Barclays, Limited, one of our four most
important banks. The speech is a full-blooded attack on public
planning and on State intervention in economic affairs. Among
other matters, he criticises the Labour Government’s housing
policy. “Personally,” he pontificates, “I feel certain that the
insistence of the Labour Government on retaining this activity so
largely in public hands has caused quite needless inflation of the
price of these now houses. I believe that if private enterprise had
been allowed to operate freely in this field subject only to control
of design and construction and to a ceiling price, the result,
given the co-operation of the trade unions concerned, would have
been a lowei-ing of the price of the finished article.” Later on, in
the same speech, as though determined to plumb the depths of
fatuity, he deplored the consequences for Great Britain of the
shortage of coal. Now if the reader will consider those two
statements together, he will begin to see how dangerous it is to
allow the Tukes of this world to have their way. He laments the
shortage of coal, which means of coal miners, which in its turn
means more houses are needed in the Tnining districts. At the

RAW MATERIALS, SCARCITIES AND PRIORITIES 157

same time, he would allow private enterprise to build houses where
it likes, for those willing to buy them on loans from building
societies. This might begin to make sense if private enterprise
would give preference to houses in the mining areas, and if the
miners wanted to put themselves in debt to buy them. But that is
precisely what did not and would not happen. The building of
houses to rent was entrusted to the public authorities, because that
was the only way of getting houses to those people whose services
were most needed by the nation. Reliance upon the profit motive
would have resulted in the building of houses for those whose
work was less urgently required by the community. An additional
proof of this is to be found in the fact that even the permitted
quota of houses to be built for private ownership was not taken
up in many .of the mining districts.

The same story is true of the agricultural districts. Next to the
need for more coal production is the urgent necessity to grow
more food on our own land. It was possible to get the builders
to build houses in the deep countryside only by denying them the
right to build in the urban areas bordering on the agricultural
bolts. Here again the only agency available to build for the
agricultural workers were the public authorities who could build
for letting. The speculative builder is useless to the agricultural
worker.

The distribution of labour in Britain is dangerously weighted
against the industries we depend upon for our survival. These are
in the main coal, steel, and agriculture. The policy advocated by
people like Mr. Tuke would starve them of homes and aggravate
still further the ominous ill balance of the labour force in Britain.
It was a piece of good fortune for Britain that such troglodyte
views were not let loose in the years immediately following the
war. Mr. Tuke, and those who t h ink like him, must begin to learn
that we could manage to survive without money changers and
stockbrokers. We should find it harder to do without nuners,
steel workers and those who cultivate the land.

But it will be noted that even Mr. Tuke is compelled to qualify
his support for private enterprise. He would nobble it. So

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difficult is it to make the urge for profit conform to decent
standards of behaviour that he would insist on conditions as to
design, construction and price. These would entail form filling,
licences, proscriptions, and supervision; all the paraphernalia of
the planning he so deeply loathes.

One more word and I have finished with Mr. Tuke. If the
provision of houses during the difficult early post-war years had
fed the greed of the profit-taker and been conditioned by the
size of the purse, we should not have enjoyed the immunity from
civil strife that we did. The demobilised soldier would not have
appreciated the finer points of Mr. Tuke’s economics. Even as
it was we had a wave of forcible seizure of accommodation in
1946. It is easy to lecture, now that the dangerous period is past..
We listen with scant patience to the homilies of Conservative
bankers, for the positions they now abuse were rendered more
secure by the rejection of their policies.

One way out of the dilemma of what to do without, when a
sudden additional demand is made, as in the case of the arms
programme, is to meet it by increased production. This is a much
less painful process than cutting back civilian consumption. No
pressure groups have to be resisted, no votes are endangered, and
above all, no general education in the facts of our economic life
is needed.

This was the goal set for Itself by the American Administration.
The people of the United States were to have both guns and
butter. Time magazine, on the 31st of December, 1951, reported
under the heading “The Great Gamble”: “In 1951, said Defence
Mobiliser Charles Wilson, we took a gamble . . . perhaps the
greatest gamble in our history.” By ‘we’, Charlie Wilson meant
the United States of America. The gamble was that U.S. business
could expand fast enough to (1) produce the arms needed for
possible war, and (2) furnish the U.S. people with all — or almost
all — ^the civilian goods they wanted. As Time went on to point
out, the gamble did not quite come off. Civilian goods and even
luxury goods production were kept at a phenomenally hi^ level,
but the arms targets were not reached. Since then President

RAW MATERIALS, SCARCITIES AND PRIORITIES 159

Truman has warned that 1952, and possibly 1953, will see a cut
back in civilian consumption. But the goal still remains, that is,
to meet the whole increased arms programme of the United
States by increased production capacity.

There is no reason to suppose that, given time, she will fail.
Already additional machines and plant have been provided equal
to almost seventy per cent of the national output of Britain. Steel
production is planned to reach one hundred and twenty million
tons a year, or more than half the world production. This year the
U.S.A. will devote to arms fifteen million tons more steel than the
total steel output of the Soviet Union. Equal and even greater
results have been achieved in other branches of industry.

U.S.A. industrialists are justifiably proud of what they have
accomplished. And so they might be. Judged as a feat of
technical skill and energy it is breath-taking. It is a triumph of
the mechanical arts. Its other implications, for the strategy of
diplomacy, I have dealt with in the last chapter. Here I am con-
cerned with the consequences of this staggering spate of produc-
tion for the economic prospects of the world. Let us reflect a little
on what all this means.

What would happen if all of us applied the art of extracting
and fabricating the raw materials of the earth with the same
amount of success? Has anyone attempted to work out the
consequences? Are we sure the raw materials are there? Especially
the precious metals. Copper and zinc, for example? At the
moment there is plenty of iron ore in sight, although even this is
running ominously short in certain areas. We are nearing the
exhaustion of tin. Of course the optimists try to shout down our
doubts by asserting the endless ingenuity of man in finding new
sources of supply and in discovering substitutes. But would not
elementary prudence counsel that we should have a look round
and assess our resources before we run through them in this
prodigal fasliion?0

It must be kept in mind that the U.S.A. is not spending her
own resources alone. She is spending the common stock of man-
kind. The U.S.A., as Governor Dewey pointed out a little time

160

IN PLACE OF FEAR

ago, imports more than ninety raw materials from outside her
borders, all essential for her industries. Of course she is buying
them with her dollars. In the language of commerce that ends
the matter. But we may be reaching a situation where the com-
mercial answer may not suffice.

One reason why the world shortage of raw materials slowed
down the arms programme of the Western Powers is because tlie
tempo of the fabricating industries is so much faster than that
of the extracting industries; and also, of course, because the more
immediately accessible metals have been exhausted and we are
having to go farther afield for new supplies. It is easier to turn
out the blueprints for a production line than it is to discover
and then extract the precious metals with which to feed it.

This has caused some superficial observers to argue that the
problem is therefore merely a technical one of timing the two
processes so that the extracting industries are brought in line with
the time schedules of the fabricating plants. Of course this is
true on a short view — a very short view. But it also implies a
nervous dependence on supplies from beyond a nation’s own
borders and therefore the temptation — which appears as a
necessity — ^to interfere with the politics of the supplying nation.
We have witnessed this in Persia, in Egypt, and in Malaya.
Recently an E.C.A. project was launched to provide rail transport
in Rhodesia for the purpose of facilitating the extraction of
precious metals. The agreement(®) states: “. , . such improve-
ment of facilities will materially assist the production and trans-
port of certain materials produced within Northern and Southern
Rhodesia, such as cobalt, chrome, copper, and tungsten, which are
required by the Government of the United States as the result of
deficiencies in resources within the United States.” A railway
supplied on such terms is no longer a straightforward enterprise
in international investment earning its dividends by the profit-
ability of the railway system alone. It is a tie-up of a quite different
kind, far removed from the simple transactions of a free enter-
prise economy.

But the most serious immediate problem is that these raw

RAW MAIERIALS, SCARCITILS \ND PRIORITIES 161

matciials are physically exhaustible and when exliausted irre-
placeable. 1 repeat hcie the question I asked earlier. Suppose the
rest of the world, or even Europe alone, burned up scarce materials
at the same pace as the United States of America? Let me quote
again from Time magazine of December 31st, 1951, for it presents
a fascinating study of how little insight can go along with a great
deal of knowledge. Talking of some of the difficulties the
rearmament programme is encountering, the article goes on to
say: “. . . In E.C.A.’s place Congress has authorised a maximum
of six billion dollars in the fiscal year 1952 for economic aid
and to help Europe rearm. But the rearmament effort has already
wiped out much of E.C.A.’s gain. In the last eighteen months,
Europe’s prices shot up (France by tliirty per cent), her currencies
weakened and the dollar gap widened at year’s end to tluee point-
five billion dollars. This trouble arose because there was so little
slack in the European economies to take up the arms load.
Furthermore, despite all the missionary work of E.C.A. and U.S.
business men, European industries are woefully inefficient by
U.S. standards and still favour cartels and monopolies rather than
the U.S. brand of free enterprise. European business men blandly
ignored the example of the U.S. in 1951 ; they, too, could expand
their economies to bear the arms burden more casUy, if they
prized competitive freedom as highly as personal freedom.
Without such a change, the vast new plants which the U.S. threw
up in 1951 will make it harder than ever for European nations
to compete in world markets or sell in the U.S. . .

Having said all this, the magazine then goes on to make a
comment wliich makes nonsense of it all. . . Apart from
money’*, it comments, “the U.S. had to re-assess how far it could
stretch its own natural resources. The vast new expansion was using
up such minerals as iron, copper and lead far faster than anyone
had anticipated only a few years ago. In many ways the U.S., once
the owner of seemingly inexhaustible natural treasure, was in danger
of becoming a have-not nation. . . . The end of the fabulously
rich ores of the Mesabi Range was already in sight. Steel-
makers not only began shipping in ore from South America and

162

IN PLACE OF FEAR

Liberia, but in 1951 they began operating plants to make the
poor-grade taconite ore usable. Copper became so scarce that
some metal producers talked of a permanent copper shortage
(and saw aluminium taking its place in many ways). In 1951 the
U.S. tried to fill its need for raw materials by grabbing them in the
world market. But in 1952 the U.S. would have to do more sharing
and tailor its domestic needs more closely to the needs of all the
Western nations.” (My italics.)

The absurdities contained in these quotations are not the fault
of Time. If they were merely that, they would not be worth
quoting and answering in a work of this nature. I call attention
to them because they put the fundamental defects of the American
Way of Life so clearly, if unconsciously.

Europe is reproached because she does not produce as efficiently
as the U.S.A. The U.S.A. will not be able to produce as much as
she hoped this year because she will have to share scarce raw
materials with Europe. So if Europe produced as efficiently as
the U.S.A. there would be an even greater quantity of idle plant
in both continents. Thus the greater the productive efficiency the
more plants would be idle. Nevertheless Time magazine deplores
the failure of Europe to imitate the efficiency of America’s pro-
duction methods. The spectacle therefore afforded us by the
United States is one of technical brilliance and social blindness.
Given the present state of knowledge, if the rest of the world was
able to fabricate materials with the facility of the United States,
the plants could not be operated. The free enterprise economies
would have worked themselves to a partial standstill. I do not say
that this would necessarily be a permanent condition. We may
at some time be able to run a mechanically-based civilisation with-
out using metals and minerals — at least those quickly exhausted.
But we have not reached that stage yet by any means. At the
rate we are going we are sawing off the limb on wliich we are
sitting — and the defenders of the acquisitive competitive system
invite us to admire the sharpness of the saw.

This expansionist process, pursued without regard to its
ultimate possibility of real value in terms of human happiness and

RAW MATERIALS, SCARCITIES AND PRIORITIES 163

good-will, was enormously accelerated by two world wars and
now by preparation for the third. For example, the U.S.A.
increased its steel production during the last war by more than
the total British output at the time. Nevertheless, war only
emphasised the principles which are innate in the competitive
system, and these arise from a chronic incapacity for discriminat-
ing selection and a just apportioning of the national product.
We are told by a spokesman of the United States steel interests
that the decision to expand further steel production was taken
before the Korean War.

The consequences of all this is to create such a state of ill-
balance between the dollar world and the rest, as to give rise to
alarm bordering on panic as to what will happen when the
rearmament drive is over— if, that is to say, we are fortunate
enough to escape wax in the meantime. All the world, outside the
Soviet-dominated Bloc, will be geared to the economy of tlie
United States. We have already learned what that means, even
before the last gigantic rise in the U.S. productive capacity takes
effect. A recession of only fottr per cent in employment in the
United States was sufficient to produce a crisis in Europe. A
recent report published(^ by the United Nations grimly underlines
the danger. It points out that if a similar recession follows
rearmament, and it results in the same order of disturbance, then
the dollar income of the outside world would be reduced in two
years by ten thousand million dollars, equal to a quarter of the
total income. In 1947 these countries held reserves totalling about
fifty per cent of the annual value of their imports. The proportion
is now only twenty-five per cent. It would not therefore need a
major slump to finish those resCTves within a year. If nothing is
done to deal with that situation Stalin will not need to lift a finger.
The capitalist system will do the job for him.

It is quite possible, indeed it is even probable, that there are
immense deposits of precious metals and minerals yet to be
surveyed and discovered that would add many more years con-
sumption for the mechanical arts. It is very much to be hoped
that there are. Otherwise the outlook is black for those nations

164

IN PLACE OF ILAR

that have scarcely started to nibble at them. The attempt to
discover them should be undertaken at once. This should be done
not by private adventure but by some agency of I he United Nations
acting for the whole world, so that they could be extracted imder
reasonable conditions for the nations and peoples immediately
concerned, and shared among the consuming countries in accord-
ance with some carefully worked-out plan of priorities. Unless
titis is done we shall reach crippling physical limits to what we can
do to lift the standards of material comfort for the backward
peoples.

More and more stress needs to be laid on the use of machinery
for the cultivation of products of the surface soils. The absence
of a plan for putting first things first is creating a macabre situa-
tion. Soon, if we arc not more prudent, millions of people will
be watching each other starve to death through expensive tele-
vision sets. If action at the governmental level had not been
taken for the stimulation of agricultural production in Britain
the standards of food consumption of her people would be even
lower than they are; so hopelessly inadequate was competitive
capitalism as an agency for meeting the needs of the
people.

It is newsprint, however, that provides the most striking illus-
tration of tho present anarchy in world production and con-
sumption. The United States, with one fifteenth of tlie world’s
population, consumed in 1950 well over two-thirds of the world
newsprint supplies. It had incareased its average pre-war con-
sumption per head by fifty per cent, while the United Kingdom
suffered a decrease of more than fifty per cent. Nearly every
European country, along with New Zealand and Australia,
suffered a fall from pre-war consumption. Some idea of the
impact of the American demand on world supplies can be gained
from the fact that a one per cent cut in American consumption
would enable Britain to abolish tonnage rationing and restricted
circulation and go back to six page newspapers as a step to further
increases. A reduction of twenty-live per cent in American con-
sumption would still leave her more than nine per cent above

^lAW MAltRMLS, SCARCITIES AND PRIOIUTITS 165

pre-war and allow other countries to reach their pre-war
consumption.(‘)

It is true that many countries have large illiterate populations;
but this is really beside the point, because even if they could all
read, no more newsprint would be available for them.

Over the past year the price of paper has gone up one hundred
per cent. It is now between five and six times higher than pre-
war. The consequences of all this for Britain are further aggravated
by the concentration of newspaper ownership in fewer hands and
by the huge circulations of tlic national dailies and weeklies. In
one year alone, 1951, fifty journals ceased publication. The same
thing is happening in many other countries.

Faced with these facts, what is the use of talking of a “Free
Press”? If it is true, and I believe it is, that a free Press is an
essential condition for the funaioning of a democracy, then these
figures bear no other interpretation than that democracy is being
strangled more effectively by the normal operations of the capi-
talist system than by the military threat of Soviet Communism.
Without free expression of opinion and the means to ensure it a
democracy dies. Its death is no less certain because it occurs
stealthily and by the slow silting-up of the channels of com-
munication. What is the use of demanding the extension of
democratic self-government to countries where it does not now
exist and then denying democracy the very breath of life, by an
unrestrained gobbling up of the w'orld’s supply of newsprint?

Of all monopolies, monopoly of opinion is the worst. Of all
forms of consumption, apart from food itself, that of free and
therefore diversified opinion should be the persistent aim of a
civilised society. Yet it is the one form of consumption which has
failed to regain pre-war levels, apart from the United States,
Canada, Sweden, Switzerland, and one or two countries where in
any case the consumption was infinitesimal. A New York citizen
will stagger along under the weight of a ninety-page Sunday
newspaper, which he will never have either the time or the
inclination to read through. In Great Britain it cannot be said
that smaller supplies are put to better use. The newspaper owners

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IN PLACE OF FEAR

are bullied by their swollen circulations. The smallest recession
produces an “Office crisis”. The British people have never been
less informed about what is happening in the rest of the world.
A large proportion of the tiny space now left to the national dailies
and weeklies is devoted to deliberate pornography or to retailing
the minutest details of the lives of the Royal family. Indeed, the
latter has now reached a point where it has become a national
disgrace. It must be deeply repugnant to the persons immediately
concerned, who are carrying out difficult duties with commend-
able dignity and restraint.

A sort of newspaper Gresham’s Law appears to be operating
where only bad standards of journalism are commercially success-
ful. The prevailing shortage of newsprint means that the career of
journalism no longer offers adequate opportunities for high
quality work. The small circulation magazines and local papers
are not present in sufficient quantity to provide a means of
recruitment for new talent and diverse effort. The resulting
impoverishment is all the more deadly because it is insidious and
hardly noticed. It is a stale of affairs that must occasion anxiety
to all who value the position of the newspaper in the life of the
nation.

There is only one corrective for this and it is the one denied us :
cheap and plentiful supplies of newsprint so that it is com-
paratively easy to start new journals and so seek out a readership
now rendered inarticidate by the mass circulations. Neither the
governments nor the private interests concerned can plead that
they have stumbled blindly into this newsprint crisis without
knowing what was happening to them. There is nothing new in
the facts that I have here set out. They have been reported and
commented upon in every section of the Press. But so far private
initiative has failed to find the remedy.

We cannot rely entirely on former sources of supply. We must
search out substitute materials. An urgent effort should be made
at once, before the present cultural decline degenerates into
torpor.

CHAPTER IPN

DEMOCRATIC SOCIALISM

“ After the first death, there is no other.” With that lovely and
tender line the poet Dylan Thomas ends a poem on the death of
a child killed in a fire-raid on London. (^). The poet here asserts
the uniqueness of the individual personality. If the imagination
can plumb the depths of a personal tragedy, no multiplication of
similar incidents can add to the revelation. Numbers can increase
the social consequences of disaster, but the frontiers of under-
standing are reached when our spirit fully identifies itself with the
awful loneliness and finality of personal grief.

The capacity for emotional concern for individual life is the
most significant quality of a civilised human being. It is not
acliieved when limited to people of a certain colour, race, religion,
nation or class. Indeed, just to the extent that this or that group
commands our exclusive sympathy, we are capable of the most
monstrous cruelty, or at best indifference, to others who do not
belong to the group. Describing a hanging scene at Tyburn gaol
not so much more than a hundred years ago, the learned and
observant diarist, Charles Greville, “was astonished by the
incomprehensible attitude of some of the boys sentenced to be
hanged Never,” he is reported as saying, “did I see boys
cry so.”(*)

These children belonged to a different social class from
Greville’s. Their terror apparently made no claim on his emotions
or understanding. In much the same way the Nazis put the Jews
outside the walls of their personalities, except as objects of
sadistic pleasure. So, too, races of a different colour from their
own, or groups that stand in the way of their ambitions, are
regarded by some of our contemporaries.

Not even the apparently enli^tened principle of the “greatest
good for the greatest ntunber” can excuse indifference to indivi-
i6 167 M

168

IN PLACE OF FEAR

dual suffering. There is no test for progress other than its impact
on the individual. If the policies of statesmen, the enactments of
legislatures, the impulses of group activity, do not have for their
object the enlargement and cultivation of the individual life, they
do not deserve to be called civilised.

It is its preoccupation with the needs of the individual that has
caused Democratic Socialism to be called “dull”. Some visitors
to Britain during the lifetime of the late Labour Government com-
mented on what they described as the “universal greyness of the
social climate”. And, of course, on the scarcity of porterhouse
steaks in the fashionable restaurants. Rationing and “Fair
Shares” in the necessities of life was so “dull”. They complained
of the “lack of colour” in the cities. If they had looked closer
they would have seen the roses in the cheeks of the children, and
the pride and self-confidence of the young mothers. They would
have found that more was being done for working people than in
any other part of the world at that time.

Where wealth is concentrated in few hands the outcome is
ostentatious spending and the meretricious glamour that goes
with it. The accompanying social climate lends a certain super-
ficial circumstantiality to the claim that only the competitive
society is pervaded by a spirit of “adventure”. It is more
“adventurous” to have a numbm: of millionaires than it is to spend
the money wasted by them on curing and preventing ill-health.
The fashionable magazines and newspapers neon-light the petty
foibles of the well-to-do. Through the dazzle it is not easy to sec
the mass of discomfort and downright misery which is the other
side of the picture.

The attempt of democratic socialism to universalise the con-
sumption of the best that society can afford meets with resistance
from those whose sense of values is deformed by the daily parade
of functionless wealth. When wealth is dispersed and distributed
in scores of millions of homes the result is not so conspicuous.
The social scene provides fewer dramatic contrasts. But there is
no doubt about which type of society produces more quiet
contentment and political stability .(®)

DEMOCRATIC SOCIALISM

169

When the ordinary man and woman is disfranchised, as in the
dictatorship countries, the emphasis on the public spectacle is
still greater. Consumption by pageantry takes the place of private
consumption. Vicarious consumption has a subtle and dangerous
influence on human psychology. If your own life is one of
poverty and powerlessness, there is a tendency to seek compensa-
tion in institutions with which it is easy for you emotionally to
identify yourself. This probably explains why the poorest
members of the community are often the most chauvinistic. The
well known bellicosity of dictatorships is therefore fed by a
morbid desire for the enjoyment of vicarious power by the
politically helpless masses. It is not only that coercion and
bullying come easily to those who have climbed to power by
these means and who maintain themselves there by similar
methods : it is also because the whole social psychology of such
communities is perverted by the horrible contrast between
individual weakness on the one hand and the pomp of unbridled
power on the other.

It is therefore no accident that it is among the solid artisan
classes that you will find the most tolerance and the least belli-
gerency. Their attitude corresponds most closely with that of
democratic socialism. Their lives are rounded by the con-
seiousness of acquired skills and by the rhythm of daily labour
which lead to a wholesome psychology needing no compensation
in flag-waving and drum-beating. TTiey have little taste for the
“grandest adventure of all”— war.

The philosophy of democratic socialism is essentially cool in
temper. It sees society in its context with nature end is conscious
of the limitations imposed by physical conditions. It sees the
individual in his context with society and is therefore com-
passionate and tolerant. Because it knows that all political action
must be a choice between a number of possible alternatives it
eschews all absolute proscriptions and final decisions. Conse-
quently it is not able to offer the thrill of the complete abandon-
ment of private judgment, which is the allure of modem Soviet
Communism and of Fascism, its running mate. Nor can it escape

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IN PLACE OF FEAR

the burden of social choice so attractively suggested by those who
believe in laissez-faire principles and in the automatism of the
price system. It accepts the obligation to choose among different
kinds of social action and in so doing to bear the pains of rejecting
what is not practicable or less desirable.

Democratic socialism is a child of modern society and so of
relativist philosophy. It seeks the truth in any given situation,
knowing all the time that if this be pushed too far it falls into
error. It struggles against the evils that flow from private property,
yet realises that all forms of private property are not necessarily
evil. Its chief enemy is vacillation, for it must achieve passion in
action in the pursuit of qualified judgments. It must know how to
enjoy the struggle, whilst recognising that progress is not the
elimination of struggle but rather a change in its terms.

4 ^

In the beginning of this book I spoke of political power and
of how the problem of attaining it appeared to young workers like
myself in the industrial towns and cities of Britain. We were pre-
occupied with how to raise the general standard of life. The
pursuit of power presented itself to us in social and not in personal
terms. It is clearer to me now than it was then that the nation is
too small an arena in which to hope to bring the struggle to a
final conclusion. Tliis is true whether the nation is large or small.
Thus the attaimnent of political power in the modern state still
leaves many problems outside its scope. National sovereignty
is a phrase which liistory is emptying of meaning.

Many seeing this are inclined to turn away from the difficult
task of establishing Socialism in their own country. They say,
“What is the use of doing so? We shall still find ourselves
possessed of only a partial victory. Only world victory will
suffice, so let us concentrate on that.” This is an engaging and
seductive view and many have succumbed to it. We are all
acquainted with the world statesman who is forever making
global constitutions while the one nearest him is in the control
of someone else. If you are going to plan the world you must

DEMOCRATIC SOCIALISM

171

first of all control the part of it that you will want to fit into
the whole. International organisations are continually passing the
most idealistic resolutions, that remain in the air because the
statesmen subscribing to them are without the economic power to
carry them out. The assumption behind these activities is that
social and economic conditions derive from political constitutions.
But the reverse is the case. An old teacher used to tell me,
concerning nations and constitutions, “The man’s clothes are
there because the man is there; not the man there because the
man’s clothes are there. A nation is a nation before it gets a
constitution.” The constitution is the codification of an accom-
plished fact.

This is not an argument against international co-operation.
On the contrary, one of the main themes of this book is a plea
for more and more international co-operation. But this would be
given greater reality in action, if the governments of the world
could speak with authority for the economic behaviour of their
own peoples.

Looking back over more than thirty-five years of industrial and
political activity I find no reason to alter my conviction that the
principles of democratic socialism are the only ones broadly
applicable to the situation in which mankind now finds itself.

APPENDIX

Chapter I. p. 3 0)

The average annual unemployment figures in Germany from
1924-1933 were as follows:

1924 911,000

1925 646,000

1926 2,011,000

1927 1,353,000

1928 1,353,000

1929 1,692,000

1930 3,076,000

1931 4,520,000 1 with a maximum of 6,500,000

1932 5,603,000 ) in the winter 1931 /32

1933 4,733,000

In the Elections of 31st July, 1932, Adolf Hitler obtained
13,732,779 votes. A little over three months later (6th Nov.)
he polled 11,705,256 votes in the last free elections to be held in
the Weimar Republic. In early 1933 there was a marked swing in
public sentiment away from the Nazis. So much so that Social
Democrats and Conservatives alike were jubilant when Hinden-
burg dissolved the Reichstag and ordered new Elections for
March 5th. But on Feb. 27th the Reichstag went up in flames.
The following day Hindenburg suspended the constitution,
leaving the Nazis, who had an insufficient majority in the Reich-
stag to govern effectively, free to impose government by whip,
firearms and jackboot.

P. 6 (®)

I mean here no direct part. Of course working-class movements
and struggles profoundly affected Parliament, but the influence

APPENDIX

173

was indirect. The personal composition of Parliament v/as not
influenced by them. It is with the impact of a new type of
Member upon Parliament that I am here dealing.

p. 8 O

See Jefferson, by S. K. Padover, p. 297.

p. 11 (0

The Parliamentary Secretaries’ Branch of the Clerical and
Administrative Workers’ Union is negotiating at the time of
writing for an increase in salary from £364 to £390 a year. A
Member of Parliament is paid £1,000 a year, less income tax,
from which he must meet all public as well as personal and family
expenditure. Most M.P.s have to budget for hotel accommoda-
tion in London when Parliament is sitting, in addition to main-
taining their private households. It will therefore be apparent
that imless they have some other source of income they cannot
afford secretarial help.

P. 11 (“)

See Why Not Trust the Tories, by the author, pp. 87-89.

Chapter II. p. 19 0)

The following extract from Frederick Engels’ Prefiice to the First
English Translation of Marx’s Capital gives an unequivocal
summary of Marx’s views:

"Surely, at such a moment, the voice ought to be heard of a
whose whole theory is the result of a Ufe-long study of the
economic history and condition of England, and whom that
study led to the conclusion that, at least in Europe, England is

174

APPENDIX

the only country where the inevitable social revolution might
be affected entirely by peaeeful and legal means. He certainly
never forgot to add that he hardly expected the English ruling
classes to submit, without a ‘pro-slavery rebellion’, to this
peaceful and legal revohition.”

5th November, 1886.

(Everyman’s Edition of Capital [1930] Vol. II. p. 887).

p. 23 n

In Britain, from 1881-1891, the net annual loss by migration
averaged 2,600 persons per million of population — a rate of
77,000-86,000 per annum over the ten-year period. The main
recipient was the United States that, during the hundred years
1821-1921, was reinforced by a flow of population from Europe
not far short of 30 million. In 1929 Britain’s net loss of population
due to emigration was 76,000 persons.

p. 23 (=0

“No matter how big the deputation which comes from
Liverpool and other northern cities and towns to Downing
Street, the Ministry of Health, or the Ministry of Labour, to
complain of the expense of maintaining the local poor, it is
unlikely that any action wUl be taken or even promised. All
proposals have in effect meant that Brighton, Bournemouth
and other rich towns should be asked to pay part of the cost of
maintaining the poor in Liverpool and Manchester. The
Government objection is that if money is to be taken from
towns in the South of England to relieve rates in the Nordi,
the incentive to economy and strict administration, it is felt,
would be weakened,’’

Extract from the Daily Mail in February 1933. One of the
deputations, from Liverpool, succeeded in making its views clear

APPENDIX

175

to Sir Hilton Young, then Conservative Minister of Health, He is
reported, in the same edition of the Daily Mail, as saying that “he
was glad to have been informed personally of the situation in
Liverpool. He trusted, however, that the Corporation would
give attention to the possibilities of securing economies in their
administration.”

P. 30 (*)

“In the transition period . . . employment policy will be
primarily concerned with the transfer of men and women to
peace-time jobs. But however smoothly this transition can be
made, and however rapid may be the return to normal condi-
tions, there will still remain for treatment those long-term
problems connected with the maintenance of an adequate and
steady volume of employment which eluded solution before
the war.

White Paper of Employment Policy (Cmd. 6527) May 1944.

p. 31 (*)

Taking an index of 100 as representing the volume of Britain’s
exports in 1938, her export achievements since the war have been
as follows :

1951

1946 1947 1948 1949 1950 JanjMar. ApUJune

91 99 126 139 160 158 171

It should however be noted that endeavours by the Government to
induce British privately owned industries to export more goods to
the dollar area have not been quite so successful. The figures
showing the value of Britain’s dollar exports in comparison with
her total exports are:

176

APPENDIX

1946

1947

1948

1949

1950

1951
(first 6
months)

Exports and re-
exports (f.o.b.) to

£m

£m

£m

£m

£jn

the Dollar Area*
Total exports and

98

127

191

189

316

189

re-exports (f.o.b.)*

905

1135

1588

1818

2223

1305

Percentage of dollar
exports to total

/o

%

%

%

%

%

exports

10-8

11-2

12-6

10-4

14-2

14-4

(’•‘These figures have been taken from United Kingdom Balance of Payments
White Papers — Cmd. 8065 and Cmd. 8379.)

•

It is thus clear that although dollar exports shared in the general
export expansion there was no substantial shift in the proportion
going to the dollar area. The apparent increase in 1950 is largely
due to the monetary advantage gained by Britain following the
devaluation of the £ in 1949.

The reasons for this failure to secure a substantial diversion of
our export efforts towards the dollar area were put pretty
pungently in the Board of Trade Journal of 15th October, 1949,
by Mr. J. Paterson, the United Kingdom Trade Commissioner
in Montreal, Speaking of our trade with Canada he said:

“Failure to appreciate that the prime responsibility for sales
rests upon the manufacturer himself has been the main cause
of the United Kingdom’s inability to secure a greater share of
the Canadian market for imported goods. . . . The consensus
of opinion amongst United Kingdom manufacturers resident
in Canada is that attempts to influence home factories in ways
and means to maintain for increase business from Canada have
for the most part proved ineffective."

APPENDIX

177

Chapter HI. p. 39 0)

The stark facts of life in the early nineteenth century which so
shocked these men are, perhaps, best condensed in a commentary
by Arthur Bryant in English Saga 1840-1940, on the First Report
of the Children’s Employment Commission, published in 1842.

“From this dociunent it appeared that the employment of
children of seven or eight years old in coal mines was almost
universal. In some pits they began work at a still earlier age:
a case was even recorded of a child of three. Some were
employed as ‘trappem*, others for pushing or drawing coal
trucks along the pit tunnels. A trapper, who operated the
ventilation doors on which the safety of the mines depended,
would often spend as many as sixteen hours a day crouching
in soUtude in a small dark hole. ‘Althou^ this employment
scarcely deserves the name of labour,’ ran the Royal Com-
mission’s report, ‘yet as the cMldren engaged in it are conunonly
excluded from light and are always without companions, it
woxdd, were it not for the passing and repassing of the coal
carriages, amount to solitary confinement of the worst
order . . .’

“. . . Naked to the waist, and with chains drawn between
their legs, the future mothers of Englishmen crawled on all
fours down tunnels under the earth drawing Egyptian burdens.
Women by the age of 30 were old and infirm cripples. Such
labour, degrading all who engaged in it, was often accompanied
by debauchery and sickening cruelty; one witness before the
Commission described how he had seen a boy beaten with a
pick-axe. Lord Ashley in a speech in the Commons mentioned
another whose master was in the habit of thrashing him with
a stick through which a nail had been driven: the child’s back
and loins were beaten to jelly, his arm was broken and his head
covered with the mark of old wounds.’’

See also Siaels’ Condition of the WorMng CUm in 1844.

178 APPENDIX

P. 40 C)

Some idea of the disparity between the standards of life obtaining
in the under-developed countries and those enjoyed by the
Western world can be appreciated by examining the following
statistics.* These show the consumption and production, as
appropriate, of those goods and services which are indispensable
to the establishment and maintenance of civilised life as the
democracies have come to understand it. India and Britain have
been chosen as tlie examples.

-Per J,000 of
population

in

in

Unit

India

Britain

Electricity Production

per annum

Coal Consumption

1,000 kwh.

13

1,033

per aimum

Petrol Consumption

tons

80

3,884

per annum

Steel consumption

tons

7-8

327

per aimum

Cement consumption

tons

3-8

194

per annum

tons

7-2

148

Locomotives (per million
of population)

Carrying capacity of rail

numbers

22

410

wagons

tons

10

276

Rail freight per annum

1,000
ton miles

65

446

t*The Colombo Plan [Cmd. 8080] 1950.)

p. 42 («)

Although no reliable figures of this flow are available on a yearly
basis some idea of its extent may be gathered from an estimate of

APPENDIX

179

Feis, a well-known authority on this subject, that in December
1913 accumulated foreign investment (principally European) in
the United States amounted to £3,763-3 million. Of this total
Britain had provided £754-6 million.

p. 51 (*)

The Local Government Act, 1948, provides for a facility which
has not received much publicity from the British Conservative
press. At Section 132 it is enacted:

“A local authority may do, or arrange for the doing of, or
contribute towards the expenses of the doing of, anything
necessary or expedient for any of the following purposes, that
is to say:

(a) the provision of an entertainment of any nature or of
facilities for dancing;

(b) the provision of a theatre, concert hall, dance hall or other
premises suitable for the giving of entertainments or the
holding of dances;

(c) the maintenance of a band or orchestra;

(d) any matters incidental to the matters aforesaid, including
tlie provision, in connection with the giving of any enter-
tainment or the holding of any dance, of refreshment or
programmes and the advertising of any such entertain-
ment or dance.”

Chapter IV. p. 57 (^) ...

It is worth noting that, under the powerful stimulus given to it
by the Labour Government’s fiscal policies, total capital invest-
ment now takes a far greater share of the national product Hum
under pre-war Conservative administrations. In 1938 some 15%
of the national product was devoted to capital investment. In

180

APPENDIX

1947 the comparable figure was 19%, rising to 22% in 1948. It
has been maintained at or above 20% ever since.

p. 62 e)

Even those who pay for their own education are now heavily
subsidised indirectly by the financial help to University services
from the University Grants Committee.

p. 68 e)

The following statistics give some idea of the extent to which the
so-called “free enterprise” countries, whose policies have been
much favoured by the British Conservative Party and by powerful
American interests, have fallen behind those countries with
Democratic Socialist governments.

Industrial Production in 1950
1938 = 100

(European countries contributing more than
1% of Europe’s industrial production.)

Sweden 165

Denmark 155

Norway 151

Great Britain 150

Netherlands 139

France 121

Belgium 120

Italy 109

W. Germanv 96

181

APPENDIX

Agricultural Production in 1950
1934/38 = 100

(European countries contributing more than
5% of Europe’s agricultural production.)

Great Britain 121

Italy 102

France 96

Spain 90

W. Germany 84

The figures have been taken from the Economic Survey of Europe
in 1950, published by the Economic Commission for Europe.

P. 72 (*)

Particularly has this been true in the case of the petroleum
industry. Realising in 1946 that Britain’s dollar problem would
involve indefinite petrol restrictions unless other steps were taken,
the Labour Government sought to encoiuage the construction
of a series of oil refineries in Britain and gave its approval to a
scheme estimated to cost £125 million. In April 1947, work
began on selected refinery sites at Stanlow, Shellhaven and
Llandarcy.

Six months later Lord Woolton, Chairman of the Conservative
Party, was demanding “in these days of over-full employment
there should be a postponement of all works of a public nature,
and a discouragement of all capital expenditure, whether by the
Government or by private indmtry”. This demand was hastily
supported by many other leading Conservatives and a few tame
economists hanging on to their coat tails.

The Labour Government ignored this advice and pressed on
with its plans. In 1948, a further refinery was started at Grange-

182

APPENDIX

mouth, and in May 1949, a commencement was made on another
one at Fawley — a project to which considerable aid was given
by the U.S. administration. By 1952, as a result of these
endeavours, helped by Government intervention and encoinage-
ment, we shall be refining 15,500,000 more tons of oil than in
1939.

Chapter V. p. 82 Q)

In estimating the cost of the Service it is necessary to consider the
range of its operations and the facilities it provides. It covers all
forms of treatment, mental as well as physical. For the first time
these are integrated. Mental ill health is no longer regarded as
belonging to a world of its own. I consider this to be one of the
outstanding features of the British Health Service. The separation
of mental from physical treatment is a survival from primitive
conceptions and is a source of endless cruelty and neglect. The
mentally ill are looked upon as people who have stepped outside
of normal intercourse and this fact itself often accentuates and
perpetuates the trouble. If at the early stages of mental dis-
turbance the patient is able to get advice, not at a mental institu-
tion but by a mental specialist in a general hospital, then
subsequent degeneration can frequently be prevented. The very
fact that they go amongst the general streams of patients for
consultation and are not hived off on their own is itself a source
of helpful self-confidence.

Then there is the provision that enables mental patients to
enter mental homes voluntarily and leave when they like. In
1931 voluntary admission represented only 7% of the total
admissions, whereas by 1949 the proportion had risen to 63%.

APPtiNUIX

183

Year

No. oj
Voluntary
Admissions

Proportion
of total
Admissions

ft/

1931

1,495

/o

7

1932

2,295

10

1933

2,961

13

1934

4,078

17

1935

5,834

24

1936

6,904

27

1937

8,414

31

1938

9,651

35

1939

10,177

36

1940

8,107

32

1941

8,415

35

1942

9,359

38

1943

11,364

43

1944

12,491

45

1945

13,910

47

1946

18,059

51

1947

21,357

54

1948

27,015

59

1949

32,345

63

p. 84 O

Drugs are consumed in too large quantities. Few doctors would
disagree with that statement. It was so before the Health Service.
Indeed, excessive consumption can be described as one of the
diseases of modem civilisation. The solution is firmness by the
doctor and education of the patient. If there is abuse in this side
of the Service the fault lies primarily with the doctor. The
chemist cannot dispense what the doctor does not prescribe.
Some doctors argue that if they do not give the patient something
to take he will leave them and go to another doctor. This is one

184

APPENDIX

of the instances of “free choice of doctor” which, according to
the campaign by the B.M.A. when the Service was being formed,
was not supposed to exist.

A great deal can be done by a more intensive education of the
general population. This would improve the health of the
population as well as reduce the burden on the Health Service.
Much more imaginative use could be made of the B.B.C. and of
television to acquaint the people with the consequences of too
much drug-taking. It would also have an appreciable effect on
the number of patients attending at the doctors’ surgeries.

Already steps had been taken when I was at the Ministry of
Health to attack the problem from another and even more
promising angle. That was to forbid the consumption in the
Service of drugs which are generally advertised. These are
usually more expensive and often no better, indeed frequently
inferior, to the drugs contained on the Official Lists and the
recognised Formulary. The effect of this is threefold. It reduces
the pressure of the credulous patient on the doctor when the
former demands something he has seen advertised for its miracu-
lous properties. Second, it discourages the production and
advertising of these concoctions. Thirdly, it will substantially
reduce the cost of prescriptions with the Health Service. These
are the answers to whatever abuses may exist on the pharma-
ceutical side of the British Health Service.

p. 85 (®)

Number of Hearing cumulative figures.

New Patients

Up to December, 1948 7,511

„ „ „ 1949 48,734

„ „ „ 1950 114,835

152,000

„ „ September, 1951

APPENDIX

185

p. 87 (*)

As time goes on it is hoped that general practitioners will find it
better to work in groups, whether at a health centre or otherwise.
There are advantages in this. The work could be shared between
them so as to reduce the strain on the individual doctor. Night
calls are an obvious example. Group consultation would put
the knowledge and experience of all at the disposal of each, and
the natural desire to stand well in the eyes of his fellow craftsmen
would tend to raise and maintain standards.

There is still a question-mark against health centres. There is
no doubt about their desirability. But there should be a limit to
what should be attempted in them. It would be an expensive
duplication if they developed into rivals of the out-patient depart-
ments of general hospitals. Here further experience is necessary
before final decisions are made.

P. 87 (“)

The fear that the Health Service would result in an army of civil
servants was got over by establishing a contractual relationship,
not with the Minister of Health but with the Boards of Governors
of teaching hospitals, the Regional Hospital Boards and, in the
case of the family doctors, chemists and opticians, with the local
Executive CoimcUs. Thus central responsibility for a national
service is reconciled with the principle of dispersed supervision.
This is exercised through the medium of voluntary workers. It is
not suflSciently understood that all the members of the Boards,
Management Committees of hospitals, and members of Executive
Councils serve voluntarily. This is partly responsible for the low
administrative cost of the Service.

The separate expenses of the bodies engaged in the administra-
tion of the British National Health Service amount to about
3% of the total sum spent. 60% of the e3q)enditure of the
hospitals lie outside the jurisdiction of the hospital authorities.
Wages and salaries are fixed by national agreement by means of

186

APPENDIX

Whitley awards. The area of expenditure left to the hospital
authorities within which they can exercise direct economy is,
therefore, about 40% of the total.

The Local Executive Councils are composed of representatives
of the County Councils and County Boroughs, Committees of the
three professions, medical, chemical and optical, along with
persons appointed direct by the Minister of Health. This body is
responsible for the administration and discipline of the three
services. It is therefore' the strongest line of defence against
abuse, and the body in most immediate contact with members
of the general public. On the whole it is working well, except
that the County area tends to be too far from the individual
citizen. But that must wait upon a reorganisation of Local
Government.

p. 90 (•)

It is one of the distinct advantages of a national service that the
use of improved health techniques and new discoveries of treat-
ment are immediately generalised througliout the service. This
is an advance on the past where superior methods worked their
way slowly down from the few institutions and individuals that
could afford them until long afterwards they reached — if they
ever did — the poorer members of lire community.

The question may be asked, what facilities are made available
for research in this set-up? There is first the Medical Research
Council, a body which has been in existence for many years and is
under the supervision of a Committee of the Pi’ivy Council.
Some contend that the Medical Research Council should be
brought within the administration of the Health Service. 1 am
inclined to support this view. British science has always suffered
from the distance which separates “pure” from applied science.
It is this which is partly responsible for the curious phenomenon,
referred to on many occasions, that in Britain original discoveries
are made which are not followed up in the practical field. Anti-
biotics is an example.

A3PPENDIX

18/

A closer relationship should be established between the
potential user of the results of research and the research itself.
The practical and the theoretical are two aspects of the same
activity. Their separation is a hangover from the days of
cloistered learning.

Research goes on in many of our hospitals all the time, as well
as in the private laboratories of commercial companies. More
money is now available than at any time in the history of medicine.
Most of the leaching hospitals have large sums at their disposal
for this purpose. Their endowments were not touched when
they were taken over into the Health Service.

But it is not only necessary to discover new knowledge and
improve on old techniques. We must also sec to it that useful
aptitude and sldlls are not lost. Every war produces its tragic
host of maimed, crippled and paralysed. Each time a pool of
exceptional knowledge is accumulated to cope with the problem.
As the number of patients declines with the passage of time, this
contracts, is in danger of being lost and further improvements
not pursued with the same drive. The department of the Ministry
of Pensions which provides artificial limbs, eyes, ingenious chairs
and cars, expanded at the end of the war and would have con-
tracted after the normal pattern. But the civilian population also
has its casualties, in the total sometimes as great as those in the
services. Here the National Health Service performs an invaluable
service. It maintains the pool of skill accumulated by the war
and places it at the disposal of the civilian population. The
technicians are not dispersed but are kept in contiauous employ-
ment. If war comes apin they will be there, ready immediately
to mitigate disability and suffering to the limits of human
ingenuity.

When the National Health Service started and free artificial
limbs were made available, it was a revelation to witness the
condition of the old ones left behind. It was a grim reminder of
the extent to which the crippled poor had boon neglected.

188

APPENDIX

Number of artificial limbs and surgical appliances, issued from
July 1948 to 31st August, 1951:

New Boots

112,556

Leg Instruments

69,987

Trusses

61,852

Belts

388,172

Wigs

28,617

Spinal Supports

80,652

Artificial Legs

30,002

Artificial Arms

6,003

Motor Propelled Tricycles

4,718

Hand Propelled Tricycles

3,190

Other types of Chairs

11,290

p. 91 n

Local authorities are notoriously unwilling to delegate any of
their functions or responsibilities to others. If hospital adminis-
tration is entrusted to them they must be prepared to give
generous support to the staff committees already established in
the hospitals. The problem of how to associate the workers in
the making of policy and in affairs of day to day administration
is as real in the hospital world as it is elsewhere.

By revised units of local government is not meant regional local
government areas. These would not be local government units
in any proper sense of the term.

Chapter VI. p. 94 O

Between 1876 and 1900, Britain added 576,334 square miles to her
Colonial possessions in Asia and 3,279,934 square miles to those
she already held in Africa. In these two continents there were
approximately 110 million more people under British colonial
rule in 1900 than in 1876. Though being rapidly overtaken by

APPliNUIX

189

the United States and Germany, with whom she found it
increasingly difficult to compete, Britain almost doubled her
exports during this period.

p. 95 e)

The figures for industrial production quoted in Note 3, Chapter IV,
make this abundantly clear to all save those in whom political
prejudice has produced a complete insensitivity to fact. The
further fact that by 1926, eig^it years after World War I, British
manufacturing industry under “free enterprise” was still pro-
ducing 21*2% less than in 1913 (see A Survey of the Economic
Situation and Prospects of Europe. United Nations, 1948), is
therefore added for chastening effect.

There are some British citizens who seek, however, to decry
their own country’s efforts under a Labour Government by
adverse comparisons with the achievements of the United States.
The following figures, taken from Facts About the British Economy
(E.C.A. Mission to the U.K., February 1950), put this matter
into better perspective;

Industrial Production

Year

United States

United Kingdom

{1934-1939 == ZW)

{1934-1938 =r 100)

1943

239

126

1946

170

104

1947

187

112

1948

192

125

1949

180

133

The colossal increase in the United States of 139% in 1943
above pre-war levels, as compared with the more modest increase
of 26% in Britain, is clearly a reflection of the stimffius given to
American industry by a division of the war effort which gave the
U.S. the overwhelming preponderance of the war-production task.

190

APPENDIX

With the advent of peace her industrial production index dropped
by 69 points as against Britain’s 22 point decline. But from 1946-
1949 the improvement was 10 points in the case of the U.S. and
29 points in the U.IC.

While these figures, taken from different year bases, must be
taken with appropriate caution, it is plain that Britain, who had
been denied tlie war-time stimulus to her industries and whose
peace-time industrial equipment had been allowed to become
obsolete and worn out, has made a remarkable recovery effort —
even in comparison with America. The E.C.A. Mission to
Britain evidently thought so, for it reported as follows:

“The rate of British improvement in industrial output in the
post-war years compares favourably with that of the United
States, even between 1946 and 1948. Moreover, the recession
which lowered United States industrial output in 1949 did not
affect the rising trend of British production.”

On Britain's agricultural industry’s achievements the E.C.A.
reported as follows:

“In the Um'ted States, agricultural production has risen since
1947 by 6%, while the most comparable United Kingdom
index, net output, shows an increase of nearly 9% (net output
reflects the increased production out of Britain’s own resources,
and economies made in the use of imported foods, etc.). In
both the United States and the United Kingdom, 1949 produc-
tion is not only well above pre-war, but, quite significantly, has
remained at around the high war-time levels.”

Most people, apart from the more raucous sections of the
British Conservative Party, now take some pride in Britain’s post-
war production efforts.

p. 103 (3)

Plat for Coal (published by the National Coal Board in October
1950, price 2/6d. and obtainable from H.M. Stationery Office),

APPENDIX

191

is a remarkable document which will repay careful study. If the
pre-war British coal industry had tackled its problems with half
the thoroughness displayed by the National Coal Board since
nationalisation, our whole national economy would have been in a
much stronger and more independent position than it is today.

Chapter VII. p. 106 O

As for example in Britain since the end of World War II. See the
figures reproduced below from Table 13 of National Income and
Expenditure of the United Kingdom, 1946-1950 (Cnid. 8203.
H.M.S.O. price l/9d.):

Proportion of Personal Income required to meet Taxation

£ million

1938

1948

1949

1950

Personal Income

Provision for taxes on income
and national insurance con-

4,952

9,999

10,507

11,042

tributions

415

1,413

1,449

1,589

Indirect taxes on consumption

578

1,919

1,852

1,904

Less subsidies to consumption
Total Tax liabilities in respect

-35

-553

-506

-468

of personal income

Tax liabilities as a percentage

958

2,779

2,905

3,025

of personal income

19

28

28

27

From the above table it is possible to calculate the percentage
taken from personal incomes by way of direct taxes (i.e. Income
Tax and Sur-Tax).

1938.... 9% 1948. ...14% 1949 15% 1950 15%

The above figures relate, however, to the nation as a whole.
The amounts deducted from personal incomes by way of direct

192

APPENDIX

taxes on income are therefore shown below classified according
to various income groupings — ^for 1938 and 1949 respectively.

Ranges of income before tax.

1938

1949

Proportion of

Proportion of

income deducted

income deducted

with taxes at

with taxes at

1938139 rates

1949150 rates

Under £250 per annum

0-2%

M%

£250-£499

3-2%

5-3%

£500-£999

10-8%

14-8%

£1,000-£1,999

18-2%

26-0%

£2,000-£9,999

29-1%

42-6%

£10,000 and over

57-7%

76-8%

Amongst the lower income groups the changes since 1938 have

not been of undue significance. In any event these are the principal
beneficiaries of the food subsidies. But the increases of direct
taxation are of much more importance in the case of the middle
income groups and effect, in particular, the professional classes,
salaried executives and the like.

p. 109 C)

The internal purchasing power of the pound sterling was 14/3d.
in October 1951, as compared with an average of 20/- in 1945.
(The Chancellor of the Exchequer in answer to a Parliamentary
question on 4th December, 1951. Hansard Column 209.)

p. Ill (8)

The capital and interest of a National Savings Certificate pur-
chased in July 1945 for 15/-, after malting allowance for the fall
in the internal purchasing power of the pound, was worth about

APPENDIX

193

13/- in October 1951, (The Chancellor of the Exchequer, in an
answer to a Parliamentary question on 4th December, 1951.
Hansard Column 209).

p. 112 (‘)

In 1938 the total number of wage-earners on colliery books was
782,000. In July 1951 the figure was 701,000,

p. 115 («)

I prefer an element of taxation in the prices paid for the goods
and services provided by an extended range of nationalised
industries to the currently imposed Purchase Taxes. These serve
their purpose in that they give the individual an apparent freedom
to spend his income (after deduction of direct taxes) as he wishes.
But they involve an army of officials, and their computation and
collection is a cause of much clerical and non-productive labour
which could be used to better effect.

p. 117 («)

The approaching exhaustion of the known supplies of many vital
raw materials was discussed at the United Nations Scientific
Conference on the Conservation and Utilisation of Resources
held from 17th August to 6th September, 1949, at Lake Success,
New York. Critical mineral shortages were disclosed, for example,
by Mr. H, L. Keenleyside, Deputy Minister, Department of Mines
and Resources, Canada, in a speech delivered on 18th August,
1949, from which the following extract is taken:

“Scientists and industrialists agree on the necessity of main-
taining an ample supply of minerals and metals if contemporary
forms of civilisation are to bo maintained, or if further progress

194

APPENDIX

is to be achieved along lines already defined. Iron, copper, lead,
zinc, nickel, aluminium, magnesium and other base metals are
by definition fundamental to our way of life. Almost equally
important arc such alloying metals as manganese, chromium,
molybdenum and tungsten, which are essential to the steel
industry. The industrial minerals — limestone, sulphur, salt
and fluorspar — supply the raw materials for much of the
world’s chemical industry, while the mineral fertilisers,
phosphate rock and potash, are of growing importance in
agriculture. Without these, or of effective substitutes, large
segments of the prospective population on the earth will bo
condemned to misery and degradation.

“Since the beginning of this century the depiction of our
mineral resources has been proceeding at an unexampled rate.
Indeed the quantity of mineral products consumed between
1900 and 1949 far exceeds that of the whole prccedhig period
of man’s existence on earth. It is a grim commentary on human
intelligence that a great proportion of the minerals used during
the last five decades has been criminally wasted in the waging
of the most destructive wars in history.

“It is quite clear that the combmation of an increasing
population and rising standards of living will place a strain on
our metal reserves which will almost certainly in the end prove
beyond the capacity of man and nature to supply.’’

Chapter VIII. p. 121 0

It is not generally known that Britain lost approximately one
quarter of her national wealth in the course of World War 11.
A rough estimate, at 1945 prices, of Britain’s pre-war wealth,
puts the figure at £30,000 million. According to Statistical
Material Presented During the Washington Negotiations (Cmd.
6707, published by H.M.S.O. in December 1943, price 3d.), we
lost a total of £7,248,000,000, made up as follows:

APPENDIX

195

Financial Losses.

Sales or repatriation of overseas
investments £1,118 mill.

Increase in sterling balances and
overseas loans 2,928 „

Depiction of gold and U.S. Dollar
reserves 152 „

£4,198 mill.

Physical Losses,

Destruction and damage to pro-
perty £1,450 „

Shipping losses 700 „

Depreciation and obsolescence not
made good during the war period 900 „

£3,050 „

Total £7,248

In addition we had sacrificed two-thirds of our export trade.
Our economy was distorted from top to bottom to enable the
maximum war effort to be made. In mid- 1945 the number of
people serving in the armed forces and civil defence and
employed in war industries totalled over 9 million, compared with
2 million in 1939. The National Debt had increased from
£7,130 million in 1939 to the staggering total of £21,366 million
in 1945.

p. 122 O

Neither does the aid tliat Britain has received from the United
States justify, as Conservative politicians are so fond of seeking
to justify, the charge that Britain has played the beggar in inter-

196

APPENDIX

national economic affairs. From the end of the war until mid-
1950, Britain had received aid totalling £1,893 million. But
during the same period, and despite her war-time losses, she had
provided £1,570 million. The detailed figures are as follows:

Receipts by the U.K. to 30th Jam, 1950
U.S. and Canadian Loans
E.R.P. Loans and Grants
Australian and New Zealand Gifts
Drawing Rights exercised under the Intra-European
Payments scheme

Other Capital Transactions (International Mone-
tary Fund drawings; less subscriptions, less repay-
ments of loans)

£1,227 mill.

667

46

s»

18

>9

-65

£1,893 mill.

Payments by the V.K. to 30th June, 1950

Gifts

Loans

Drawing ri^ts exercised under Intra-European
Payments scheme
Reductions in Sterling Balances
Other Capital Transactions (investments less sales
and redemptions)

400

493

85

319

273

£1,570 mill.

p. 125 («)

The 1950 Report of the Bank of International Settlements, as
quoted by the Economist of 29th July, 1950, gives the actual
percentages of defence expenditures in 1949 or 1949/50 incurred

APPENDIX

197

by various countries,
incomes :

in relation

to their respective

national

United Kingdom

%

7-4

Sweden

0/

/o

3-6

Netherlands

6-1

Canada

3-0

United States

5-9

Switzerland

2-1

Turkey

5-8

Belgium

2-5

France

5-0

Norway

2-5

Italy

3-8

Denmark

1-9

The Economist continues:

“The addition of $10 billion a year to the defence expendi-
ture of the United States will bring the percentage to almost
exactly 10%, The British figure is certainly going to rise to
over 9%, and these statistical comparisons are not accurate
enough to be pressed within a closer margin than 1%. For all
praaical purposes it is true to say that the British defence
effort, which ever since the end of the war has been the highest,
relative to the national resources, of any of the free nations,
will stand comparison, as measured by expenditure, even with
the new scale of American preparations.”

p. 128 (‘)

The section of President Truman’s Inaugural Address to Congress
in January 1949 which put forward the proposal that the United
States should co-operate in the economic and technical develop-
ment of the backward areas is now popularly referred to as
“The Fourth Point”,

p. 132 (®)

According to the Monthly Bulletin of Statistics of the United
Nations (September 1951) the steel producing countries among

198

APPENDIX

the free nations of the world averaged the following monthly
production of crude steel in 1950;

Australia

Belgium

Canada

France (including Saar)
Italy

Luxemburg

Turkey

United Kingdom
United States

Giving a total of

101,000 metric tons per month

314.000

256.000

879.000

197.000

204.000

99 99

9 » >>

91 99

99 9 >

99 99

99 99

99 99

99 99

99 99

99 99

7,600

1.380.000

7.310.000

99 99

99 99

»9 99

99 99

*9 99

99 99

10,648,600

99 99

>9 99

Or an annual figure (for 1950) of 127,783,200 metric tons.
Western Gennany, excluded from the above table, produced
1,010,000 tons per month during 1950, equivalent to an annual
figure of 12,120,000 tons.

Chapter TX. p. 159 (>)

“The sulphur committee of tlie international materials con-
ference this evening announced the allocation of crude sulphur
for the first six months of this year. Tliis is the first time any of
the conference committees has adopted the longer period of six
months for such allocation, and this change will, it is thought,
prove to be of considerable help to countries making procure-
ments. Out of a total of 2,953,400 long tons of crude sulphur the

APPENDIX 199

United Stales is allocated 2,226,000 tons and the United Kingdom
194,900.

The committee pointed out that in preparing this plan of dis-
tribution it had been confronted with the fact that estimated
requirements of sulpJiur for 1952 totalled 7,364,100 long tons,
while estimated production was only 5,625,100 tons — leaving a
gap of 1,739,000 tons.” — Washington Correspondent of T!ie
Times, January 25th, 1952.

p. 160 (*>)

“Agreement Between the jovemment of the United Kingdom of
Great Britain and Northern Ireland and the Government of the
U.S.A. relative to the Development of the Rhodesia Railways.”
(H.M.S.O., 6d. Cmd, 8396).

p. 163 O

“Measures for International Economic Stability.” Obtainable
at H.M.S.O.

p. 165 0

Consumption of newsprint per head of population in certain
countries in 1950 and 1951

The following data arc taken from two reports on World Com-
munications, published by the United Nations Educational,
Scientihe and Cultural Organisation, as specified;

(1) World Communications: Press, Radio, Film, May 1950.
(UNESCO publication. No. 700), pp. 164-173.

(2) World Communications: Press, Radio, Film, Television,
July 1951 (UNESCO publication, No. 942), pp. 166-175.

200

APPENDIX

Consumption of newsprint

Area and Country

per inhabitant in kilograms
(a) in 1950 (b) in 1951

report repot

Africa

Egypt

1-00

0-70

Union of South Africa

4-20

5-00

North America

Canada(*)

21-10

22-50

U.S.A.

32-50

33-60

Asia

Burma

0-80

0-10

China

0-10

n.a.

India

0-10

0-10

Iraq

0-07

0-20

Israel

4-20

3-60

Jordan

n.a.

0-20

Lebanon

0-90

0-80

Pakistan

0-06

0-06

Persia

0-06

0-09

Saudi Arabia

n.a.

0-02

Syria

n.a.

0-20

Thailand (Siam)

0-10

0-10

Turkey

0-47

0-50

United States of Indonesia

0-05

0-05

Europe

Belgium

7-60

7-50

France

5-20

6-60

Ireland (Eire)

6-00

7-00

Italy

1-50

1-60

Netherlands

5-90

5-80

Norway

7-60

7-40

Spain

0-80

0-80

Sweden

15-80

15-70

n.a. = not available.

(* Including Newfoundland and Labrador.)

APPENDIX

201

Switzerland

1100

10-80

U.S.S.R. (*)

1-70

1-70

United Kingdom

8-30

13-80

CEANIA

Australia

11-80

16-00

New Zealand

12-80

14-00

(* Including Byelorussia and Ukraine.)

Chapter X. p. 167 0)

Deaths and Entrances, by Dylan Thomas (Dent)

P-167 («)

The London Anthology, by Pauline and Hugh Massingham,
p. Xn. (Phoenix House, 21/-.)

p. 168 (3)

Visiting Italy in 1948, 1 saw cinemas in course of construction for
which imported steel was being used. In Britain we had forbidden
the use of structural steel even in house-building, as we needed
all we load for the building of factories, power stations and
engineering exports. Wlule Italian cinemas were consuming
precious steel, and skilled labour, there were villages and towns
that had been razed to the ground during the war where not one
brick had been laid on another. It was clear that the consequence
of this and of other failures to attend to the needs of the common
people as against the greed of a few would result in the growth
of the Communist Party even in the traditionally Conservative
South. I said so to members of the Italian Government at the
time. And so it proved.

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